Living outside major urban centres is associated with increased mortality in the general population but whether having diabetes further impacts on the effects of living outside major urban centres is not known. This study explores the impact of residential location and diabetes on all-cause, ischemic heart disease (IHD) and stroke mortality in Australia.We included 1,101,053 individuals (all ages) with diabetes on the national diabetes register, between 2000 and 2010. Vital statistics were collected by linkage to the death registry. The Accessibility/Remoteness Index of Australia (ARIA+) was used to categorize residences into major urban, inner regional, outer regional and remote areas, according to distance from major service centres. Standardised mortality ratios (SMRs) by ARIA+ are reported.During follow-up (median 6.7 years), there were 187,761 deaths (46,244 and 12,786 IHD and stroke deaths, respectively). Age-standardized all-cause, stroke and IHD mortality rates increased across ARIA+ categories in diabetes and in the general population. For all outcomes, similar patterns were observed in both sexes and diabetes type, although the rates were higher in males. For all-cause (both sexes, type 1 diabetes (T1DM) and type 2 diabetes (T2DM)), IHD mortality (T2DM only) and stroke mortality (T2DM only), SMRs varied across ARIA+ categories, showing a shallow U-shaped relationship, in which the lowest SMR was in the inner regional or outer regional areas, and the highest SMR in the major urban or remote areas.The effect of diabetes on mortality varied only modestly by location, and the impact of diabetes was greatest in the major urban and remote areas, and least in the inner and outer regional areas.