Type 2 diabetes mellitus (T2DM) and hypertension frequently occur together. We examined whether blood pressure (BP) levels predict eight-year incident diabetes. Participants were community-dwelling older adults who had BP measured twice and an oral glucose tolerance test at baseline and again 8.3 years later. At baseline, participants were classified as normotensive [systolic (SBP) <120 mmHg and diastolic (DBP) <80 mmHg; n=242]; prehypertensive (SBP ≥120 and <140 mmHg or DBP ≥80 and <90 mmHg; n=426); or hypertensive (SBP ≥140 mmHg or DBP ≥90 mmHg or using anti-hypertensive medication; n=457). There were 1125 participants (mean age 66.0 years; 44.3% men) who attended the baseline and follow-up visit, of whom 85 had new onset T2DM. Participants who developed T2DM had higher mean body mass index (BMI) and BP levels than those who did not develop diabetes. In logistic regression models adjusted for age, sex, BMI, and physical activity, the odds of incident T2DM was greater in prehypertensives (OR2.32 95%CI 1.05–5.1, P=0.03) and hypertensives (OR3.5 95%CI 1.50–8.0, P=0.002) compared to normotensives. Excluding participants who used anti-hypertensive medications did not change results. In conclusion, mid-life hypertension and prehypertension predicted future diabetes, independent of BMI. Glucose surveillance should be encouraged in adults with prehypertension or hypertension.