Recent studies have added to the evidence that type 1 and type 2 diabetes are associated with increased risk of hip fracture and other fractures. More frequent falls probably account for some of this increased risk, but reduced bone strength may also play a role. Although type 1 diabetes is associated with lower bone density, those with type 2 diabetes usually have elevated bone density. Yet for both types of diabetes, bone appears to be more fragile for a given density. Diabetes can affect bone through multiple pathways—some with contradictory effects—including obesity, insulin levels, hyperglycemia, and advanced glycation end products in collagen. Treatment with thiazolidinediones may increase fracture risk, at least in older women. Clinicians need to be aware of the increased fracture risk associated with diabetes. Additional research is needed to clarify the mechanisms underlying this increased risk and the best approaches to fracture prevention.