OBJECTIVES: To estimate the direct medical cost for diabetes mellitus (DM) related complications in China. METHODS:   Data were obtained from a cross-sectional survey of 20 internists of endocrine and metabolism departments in 20 hospitals from September to November in 2011 in 9 cities of China. 11 internists worked in tier 3 hospitals and 9 worked in tier 2 hospitals. All the internists who are department director or deputy director were asked to give the average costs of complications treatment according to their clinical practice and retrospective medical records. The diabetes related complications considered in this study were classified into chronic complications (Cardiovascular disease, Cerebrovascular disease, Neuropathy, Retinopathy, Nephropathy, Peripheral vascular diseases and foot damage) and acute complications (Ketoacidosis and major hypoglycemic). The direct medical costs were reported as annual costs including hospitalization, daily medications and examinations for DM-related chronic complications and as event costs for DM-related acute ones. All costs were reported in 2011 US dollar using the exchange rate of 6.47 Chinese Yuan to 1 USD. RESULTS: The annual medical cost for DM related complications per patient with and without hospitalizations: Myocardial infarction $6248.32 and $2025.26; Angina $4707.12 and $1453.63; Congestive Heart Failure $3433.08 and $1009.18; Stroke $3214.74 and $1401.46; Peripheral vascular disease $3348.11 and $1301.34; Neuropathy $2226.86 and $854.38. Renal failure with Haemodialysis $11245.93 and Peritoneal dialysis $7802.03; Renal transplant $33772.50 with operation and $8934.27 for daily maintenance. The event cost for Retinopathy: Laser operation $296.79; Cataract operation $1313.56; Amputation $2072.22; Infected ulcer treatment: $3007.11; Ketoacidosis $1493.55; Major hypoglycemic $729.18. CONCLUSIONS: The medical costs for DM related complications are overwhelming compared with the costs of insulin and hypoglycemic agents especially for those diabetic patients with severe nephropathy. Considering the high prevalence of diabetes and its complications diabetes poses substantial economic burden to the whole society in China.