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OBJECTIVE--Although diabetes is a major source of morbidity and mortality in the United States, only recently has a unified national surveillance system begun to monitor trends in diabetes and diabetic complications. RESEARCH DESIGN AND METHODS--We established a diabetes surveillance system using data for 1980-1987 from vital records, the National Health Interview Survey, the National Hospital Discharge Survey, and the Health Care Financing Administration's records to examine trends in the prevalence and incidence of diabetes, diabetes mortality, hospitalizations, and diabetic complications. RESULTS--From 1980 through 1987, the number of individuals known to have diabetes increased by 1 million--to 6.82 million. Age-standardized prevalence for diabetes increased 9% during this period, from 25.4 to 27.6/1000 U.S. residents (P = 0.03). The incidence of diabetes increased among women (P = 0.003), particularly among those greater than 65 yr old (P = 0.02). Age-standardized mortality rates (for diabetes as either an underlying or contributing cause) per 100,000 individuals with diabetes declined 12%, from 2350 to 2066. Annual mortality rates from stroke (as an underlying cause and diabetes as a contributing cause) and diabetic ketoacidosis declined 29% (P = 0.003) and 22% (P less than 0.001), respectively. During these 8 yr, hospitalization rates for major CVD and stroke (as the primary diagnoses and diabetes as a secondary diagnosis) increased 34% (P = 0.006) and 38% (P = 0.01), respectively. Also during this period, hospitalization rates increased 21% for diabetic ketoacidosis (P = 0.01) and 29% for lower-extremity amputations (P = 0.06). From 1982 through 1986, treatment for end-stage renal disease related to diabetes increased greater than 10% each year (P less than 0.001). The prevalence of diagnosed diabetes was nearly twice as high in blacks as in whites (P = 0.04). Blacks also had increased rates of lower-extremity amputation (P = 0.02), diabetic ketoacidosis (P less than 0.001), and end-stage renal disease (P = 0.01). CONCLUSIONS--Diabetes surveillance data will be useful in planning, targeting, and evaluating public health efforts designed to prevent and control diabetes and its complications.