Diabetic cardiomyopathy is a distinct primary disease process, independent of coronary artery disease, which leads to heart failure in diabetic patients. Epidemiological and clinical trial data have confirmed the greater incidence and prevalence of heart failure in diabetes. Novel echocardiographic and MR (magnetic resonance) techniques have enabled a more accurate means of phenotyping diabetic cardiomyopathy. Experimental models of diabetes have provided a range of novel molecular targets for this condition, but none have been substantiated in humans. Similarly, although ultrastructural pathology of the microvessels and cardiomyocytes is well described in animal models, studies in humans are small and limited to light microscopy. With regard to treatment, recent data with thiazolidinediones has generated much controversy in terms of the cardiac safety of both these and other drugs currently in use and under development. Clinical trials are urgently required to establish the efficacy of currently available agents for heart failure, as well as novel therapies in patients specifically with diabetic cardiomyopathy.