OBJECTIVE Data related to diabetic neuropathy in youth with type 2 diabetes are limited. We examined the relationship of glycemic control, sex, race/ethnicity, BMI, and other type 2 diabetes-associated factors with the development of diabetic peripheral neuropathy (DPN) in youth with type 2 diabetes enrolled in the Treatment Options for Type 2 Diabetes in Adolescents and Youth (TODAY) study. RESEARCH DESIGN AND METHODS The Michigan Neuropathy Screening Instrument (MNSI) and a 10-g monofilament exam were performed annually. DPN was defined as a score (2) on the MNSIexam or combined MNSI-exam and MNSI-survey scores (exam 2 and/or survey ≥4), or monofilament exam (8 of 10 correct responses) at two or more consecutive visits. Multivariable time-to-event models assessed the association of risk factors evaluated longitudinally with DPN events. RESULTS A total of 674 participants (35% male), with a mean age of 14 years and diabetes duration 2 years at study entry, were evaluated annually over an average of 10.2 years. Male subjects had a significantly higher cumulative incidence of DPN than female subjects (38.5% vs. 27.2% via MNSI-exam, P = 0.002; 14.0% vs. 5.1% via monofilament exam, P = 0.01). Rates did not differ by race/ethnicity. Higher HbA1c and BMI were associated with higher DPN, by both MNSI and the monofilament test. In multivariable models, male sex, older age, and higher BMI were associated with MNSI-exam DPN risk. CONCLUSIONS DPN was evident early in the course of youth-onset type 2 diabetes and increased over time. It was higher in male subjects and related to glycemic control. These findings raise concern for long-term development of neuropathy-related morbidity in youth with type 2 diabetes and the need to achieve improved glycemic control.