Objective. The main objective is to determine if digital pulse oximetry is an acceptable screening tool to detect hemodynamically significant lower extremity peripheral artery disease (PAD) in patients 50 years old and above with type 2 diabetes mellitus (T2DM) seen at the University of Santo Tomas Hospital (USTH).Methodology. A total of 78 subjects (155 limbs) were included. Using duplex ultrasonography as the reference standard for the presence of hemodynamically significant lower extremity PAD, sensitivity, specificity, positive predictive value (PPV), and negative predictive value (NPV) were obtained for abnormal percent oxygen saturation (SpO 2 ) gradients and for ankle-brachial index (ABI).Results. Of the 155 limbs, 38.7% had hemodynamically significant stenosis. Pulse oximetry had 76.7% sensitivity (95% CI, 65.2% to 88.1%), 85.3% specificity (95% CI, 78.0% to 92.6%), 76.7% PPV (95% CI, 66.5% to 84.4%) and 85.3% NPV (95% CI, 78.4% to 90.2%). ABI had 40.7% sensitivity (95% CI, 30.1% to 51.3%), 88.2% specificity (95% CI, 80.0% to 96.3%), 68.6% PPV (95% CI, 53.6% to 80.4%) and 70.1% NPV (95% CI, 65.1% to 74.5%). Combining both produces 88.1% sensitivity (95% CI, 78.5% to 97.8%), 74.2% specificity (95% CI, 65-83.4%), 68.4 PPV (95% CI, 60.3% to 75.6%) and 90.8% NPV (95% CI, 83.0% to 95.2%). Conclusion.The results of this study suggest that pulse oximetry has a higher sensitivity than ABI as a screening tool for hemodynamically significant lower extremity PAD in T2DM patients 50 years old and above. Combining these two tests may be done to achieve a higher sensitivity.