The current aim was to determine if an intensive lifestyle intervention (ILI) reduces the severity of obstructive sleep apnea (OSA) in rapid-eye movement (REM) sleep, and to determine if longitudinal changes in glycemic control are related to changes in OSA severity during REM sleep over a 4-yr follow-up. This was a randomized-controlled trial including 264 overweight/obese adults with type 2 diabetes (T2D) and OSA. Participants were randomized to an ILI targeted to weight loss or a diabetes support and education (DSE) control group. Measures included anthropometry, apnea-hypopnea index (AHI) during REM sleep (REM-AHI) and non-REM sleep (NREM-AHI), and glycated hemoglobin (HbA1c) at baseline and year-1, year-2, and year-4 follow-ups. Mean baseline values of REM-AHI were significantly higher than NREM-AHI in both groups. Both REM-AHI and NREM-AHI were significantly more reduced in ILI vs. DSE, but these differences were slightly attenuated after adjustment for weight changes. Repeated-measure mixed-model analyses including data through year 4 demonstrated that changes in HbA1c were significantly related to changes in weight but not to changes in REM-AHI and NREM-AHI. Compared to control, the ILI reduced REM-AHI and NREM-AHI across the 4-year follow-up. Weight, as opposed to REM-AHI and NREM-AHI, were related to changes in HbA1c. The findings imply that weight loss from a lifestyle intervention is more important than reductions in AHI for improving glycemic control in T2D patients with OSA.