Clinical data from 37 adult males with diabetes mellitus (insulin dependent, n = 22; non-insulin dependent, n = 15) who had undergone psychiatric diagnosis and peripheral nerve conduction studies were reviewed to determine whether psychiatric illness was significantly related to complaints of sexual dysfunction. Main-effects testing revealed that impotence was associated with both neuropathy (P < 0.01) and psychiatric illness (P < 0.001). Logistic regression analysis was then used to determine the independent relationships of these two variables with impotence. After controlling for the effects of neuropathy, psychiatric illness (generalized anxiety disorder and depression) remained significantly associated with sexual dysfunction (P < 0.01). These data allow for the hypothesis that psychiatric illness may be an important contributor to impotence in diabetic men, as it is in nondiabetic men, even when neuropathic complications of the disease are present.