Aims/hypothesis: Depression is associated with excess mortality in patients with type 2 diabetes. We investigated the impact, and possible causal mechanisms, of depression on all-cause and cardiac mortality in patients with type 2 diabetes. Methods: We recruited 1,273 patients with type 2 diabetes from a postcode-defined community (average age 64.1±11.2 years, 48.7% males, median duration of diabetes 4 years [range 1.0-9.0]) and followed them for 7.8±2.4 years. Depression was assessed using data obtained using a quality-of-life questionnaire, and cause and date of death were obtained from the state registry. Results: Depression was present in 31.5% of subjects at recruitment. Depressed subjects had a longer duration of diabetes, more cardiovascular risk factors, CHD, cerebrovascular disease and diabetic microvascular complications at baseline, and higher all-cause and cardiac mortality rates during follow-up. In Cox proportional hazards models and after adjustment for demographic and diabetes-related variables and cardiovascular risk factors, depression was significantly associated with excess all-cause and cardiac mortality. When diabetic microvascular and macrovascular complications were added to the Cox models, depression was not significantly associated with excess all-cause or cardiac mortality. Conclusions/interpretation: Depression in patients with type 2 diabetes is associated with a greater prevalence of complications but is not an independent predictor of all-cause or cardiac mortality. Depression may contribute to the progression of important prognostic variables in diabetes, particularly macrovascular and microvascular disease.