OBJECTIVE: Within the context of a large, nationwide outcomes research program in type 2 diabetes, we assess the prevalence of self-reported erectile dysfunction and evaluate its impact on quality of life. RESEARCH DESIGN AND METHODS: The study involved 1,460 patients enrolled by 114 diabetes outpatient clinics and 112 general practitioners. Patients were asked to complete a questionnaire investigating their ability to achieve and maintain an erection. Various aspects of quality of life were also assessed depressive using the following instruments: SF-36 Health Survey, diabetes health distress, psychological adaptation to diabetes, depressive symptoms (CES-D scale), and quality of sexual life. RESULTS: Overall, 34% of the patients reported frequent erectile problems, 24% reported occasional problems, and 42% reported no erectile problems. After adjusting for patient characteristics, erectile dysfunction was associated with higher levels of diabetes-specific health distress and worse psychological adaptation to diabetes, which were, in turn, related to worse metabolic control. Erectile problems were also associated with a dramatic increase in the prevalence of severe depressive symptoms, lower scores in the mental components of the SF-36, and a less satisfactory sexual life. A total of 63% of the patients reported that their physicians had never investigated their sexual problems. CONCLUSIONS: Erectile dysfunction is extremely common among type 2 diabetic patients and is associated with poorer quality of life, as measured with generic and diabetes-specific instruments. Despite their relevance, sexual problems are seldom investigated by general practitioners and specialists.