Diabetic foot ulcers (DFUs) are complex, chronic, and progressive wounds, and have a significant impact on morbidity, mortality, and quality of life. A particular aspect of DFU that has not been reviewed extensively thus far is its management in conjunction with peripheral limb edema. Peripheral limb edema is a feature of diabetes that has been identified as a significant risk factor for amputation in patients with DFU. Three major etiological factors in development of lymphedema with concurrent DFU are diabetic microangiopathy, failure of autonomic regulation, and recurrent infection. This review outlines the pathophysiology of lymphedema formation in patients with DFU and highlights the cellular and immune components of impaired wound healing in lymphedematous DFU. We then discuss the principles of management of DFU in conjunction with lymphedema.