There is a growing body of research showing that diabetes is an independent risk factor for fracture. Type 2 diabetes (T2D), which predominates in older individuals and is increasing globally as a consequence of the obesity epidemic, is associated with normal or even increased dual-energy x-ray absorptiometry (DXA)-derived areal bone mineral density (BMD). Therefore, the paradoxical increase in fracture risk has led to the hypothesis that there are diabetes-associated alterations in material and structural properties. An overly glycated collagen matrix, confounded by a low turnover state, in the setting of subtle cortical abnormalities, may lead to compromised biomechanical competence. In current clinical practice, because BMD is central to fracture prediction, a consequence of this paradox is a lack of suitable methods, including FRAX, to predict fracture risk in older adults with T2D. The option of adding diabetes to the FRAX algorithm is appealing but requires additional data from large population-based cohorts. The need for improved methods for identification of fracture in older adults with T2D is an important priority for osteoporosis research. © 2012 American Society for Bone and Mineral Research.