Apolipoprotein E (APOE) is a key regulator of lipoprotein metabolism, and consequently, affects the plasma and tissue lipid contents. The aim of the present study was to investigate the parallel effects of APOE genetic variants and promoter methylation levels of six CpGs on the risk of diabetic dyslipidemia. A total of 204 Palestinian type 2 diabetes (T2D) patients (mean age ± SD: 62.7±10.2) were enrolled in the present study (n=96 with dyslipidemia and n=108 without dyslipidemia). Next generation sequencing was performed to analyze five single nucleotide polymorphisms: Two variants rs7412 and rs429358 that determine APOE ε alleles, and three variants in the promoter region (rs769446, rs449647, and rs405509). For all subjects, the most common genotype was ε3/ε3 (79.4%). No statistical differences were observed in the APOE ε polymorphisms and the three promoter variants among T2D patients with and without dyslipidemia (P>0.05). A comparison of lipid parameters between ε3/ε3 subjects and ε4 carriers in both groups revealed no significant differences in the mean values of LDL-C, HDL-C, TG, and TC levels (P>0.05). Six CpG sites in the APOE promoter on chromosome 19:44905755-44906078 were identified, and differential DNA methylation in these CpGs were observed between the study groups. Logistic regression analysis revealed a significant association of DNA methylation level at the six CpGs with an increased risk of diabetic dyslipidemia (odds ratio, 1.038; 95% confidence interval, 1.012-1.064; P=0.004). In conclusion, the present study revealed that DNA methylation levels in six CpGs in the APOE promoter region was associated with the risk of diabetic dyslipidemia independently of the APOE ε4 variant which could be a potential therapeutic target to reverse the methylation of the APOE promoter.