ImportanceIn recent years, the global incidence of type 2 diabetes in young people has increased, especially among minoritized, Indigenous, or financially disadvantaged populations. However, few studies have examined whether poverty is associated with increased risk of youth-onset type 2 diabetes.ObjectiveTo examine the association of family income level with the risk of youth-onset type 2 diabetes.Design, Setting, and ParticipantsThis nationwide, population-based retrospective cohort study used data from the 2008 National Health Insurance Research Database of Taiwan, with follow-up through December 31, 2019. Participants included children and adolescents aged 0 to 19 years. Data analysis was performed from June 9, 2022, to January 16, 2023.ExposuresFamily income, classified as very low, low, middle, and high.Main Outcomes and MeasuresCox proportional hazards models were used to estimate adjusted hazard ratios (aHRs) for the risks of youth-onset type 2 diabetes and all-cause mortality for all income groups vs the high-income group.ResultsThe cohort included a total of 5 182 893 children and adolescents (mean [SD] age, 11.2 [5.2] years; 2 477 807 girls [48.3%]). The mean (SD) follow-up duration was 9.0 (0.3) years. The incidence rates of youth-onset type 2 diabetes were 0.52 cases per 1000 person-years for the very-low-income group, 0.40 cases per 1000 person-years for the low-income group, 0.35 cases per 1000 person-years for the middle-income group, and 0.28 cases per 1000 person-years for the high-income group. Children and adolescents from very-low-income (aHR, 1.55; 95% CI, 1.41-1.71), low-income (aHR, 1.34; 95% CI, 1.27-1.41), and middle-income (aHR, 1.27; 95% CI, 1.20-1.34) families had a significantly higher hazard of youth-onset type 2 diabetes than those from high-income families. Children and adolescents from very-low-income (aHR, 2.18; 95% CI, 1.97-2.41), low-income (aHR, 1.51; 95% CI, 1.42-1.60), and middle-income (aHR, 1.22; 95% CI, 1.14-1.31) families also had a significantly higher hazard of all-cause mortality than those from high-income families. Children and adolescents who were older, female, and obese and had dyslipidemia, gout, or psychiatric disorders had a significantly higher risk of youth-onset type 2 diabetes than children without those characteristics.Conclusions and RelevanceThis population-based cohort study showed that children and adolescents from very-low-income to middle-income families had a higher hazard of youth-onset type 2 diabetes and mortality than those from high-income families. Further research to reveal the factors underlying this association may improve the accuracy of identifying individuals at greatest risk for developing type 2 diabetes in youth.