Objective: Peripheral arterial disease (PAD), as well as diabetic neuropathy, is a risk factor for the development of diabetic foot ulcers. The aim of this study was to evaluate differences and predictors of outcome parameters in patients with diabetic foot by stratifying these subjects according to the severity of PAD. Research design and methods: In a prospective study, patients with new diabetic foot ulcers have been treated and investigated by structured healthcare. Subjects were recruited between 1 January 2000 and 31 December 2007. All study participants underwent a 2-year follow-up observation period. The patients underwent a standardized examination and classification of their foot ulcers according to a modification of the University of Texas Wound Classification System. The severity of PAD was estimated by measurement of the ankle brachial index (ABI) and the continuous wave Doppler flow curve into undisturbed perfusion (0.9 < ABI < 1.3), compensated perfusion (0.5 < ABI < 0.9), decompensated perfusion (ABI < 0.5) and medial arterial calcification. Results: A total of 678 patients with diabetic foot were consecutively included into the study (69% male, mean age 66.3 ± 11.0 years, mean diabetes duration 15.8 ± 10.2 years). Major amputations (above the ankle) were performed in 4.7% of the patients. 22.1% of these subjects had decompensated PAD. These subjects had delayed ulcer healing, higher risk for major amputation [odds ratio (OR) 7.7, 95% confidence interval (CI) 2.8-21.2, p < 0.001] and mortality (OR 4.9, 95 % CI 1.1-22.1, p < 0.05).Conclusion: This prospective study shows that the severity of PAD significantly influences the outcome of diabetic foot ulcers regarding to wound healing, major amputation and mortality.