Background: There are plenty of studies available to demonstrate the effect of diabetes on short-term Heart Rate Variability (HRV) but not enough about lipids, especially in our region. Hence, we aimed to study the influence of total cholesterol and individual lipid fractions on short-term HRV in type 2 diabetics. Methods: As per the set criteria, 70 newly diagnosed type 2 diabetics were recruited and grouped based on their cholesterol levels. Both the time domain and the frequency domain measures of short-term HRV were acquired and subjected to statistical analysis. This was a cross-sectional observational study. Results: Elevated total cholesterol group showed a reduction in Standard deviation of all NN intervals (SDNN) and High Frequency (HF) power and an increase in Low-Frequency power / High-Frequency power (LF/HF) ratio in comparative analysis. Similarly, the high low-density lipoproteins (LDL) group showed a decrease in square root of the mean of the sum of the squares of the differences between adjacent NN intervals (SDNN) and RMSSD but a rise in LF/HF ratio. Moreover, total cholesterol is negatively correlated with SDNN, RMSSD, and HF power while total cholesterol and LDL are positively correlated with LF/HF ratio. Total cholesterol, LDL, and triglycerides had an independent association with HF. Conclusions: Our study shows higher levels of total cholesterol, LDL and triglycerides decrease cardiovagal activity. Hence, based on this we conclude abnormal lipid levels depress HRV.