Evidence describing the impact of diabetes mellitus (DM) on the recurrence and mutation rate of Mycobacterium tuberculosis (Mtb) is limited. This study was nested in 3 cohort studies of tuberculosis (TB) patients with and without DM in India. Paired Mtb isolates recovered at baseline and treatment failure/recurrence underwent whole genome sequencing. We compared acquisition of single-nucleotide polymorphisms (SNPs), TB drug resistance mutations, and type of recurrence (endogenous reactivation <8 SNPs or exogenous reinfection ≥8 SNPs) by DM status. Of 1633 enrolled in the 3 parent cohorts, 236 (14.5%) had microbiologically confirmed TB treatment failure/recurrence; 76 Mtb isolate pairs were available for sequencing (22 in TB-DM and 54 in TB-only). The SNP acquisition rate was overall was 0.43 (95% confidence interval CI, .25-.64) per 1 person-year (PY); 0.77 (95% CI, .40-1.35) per 1 PY, and 0.44 (95% CI, .19-.86) per 1 PY at treatment failure and recurrence, respectively. Significant difference in SNP rates by DM status was seen at recurrence (0.21 95% CI, .04-.61) per 1 PY for TB-only vs 1.28 (95% CI, .41-2.98) per 1 PY for TB-DM; P = .02). No significant difference in SNP rates by DM status was observed at treatment failure. Acquired TB drug resistance was seen in 4 of 18 (22%) in TB-DM vs 4 of 45 (9%) in TB-only (P = .21). Thirteen (17%) participants had exogenous reinfection; the reinfection rate at recurrence was 25% (3/12) for TB-DM vs 17% (4/24) in TB-only (P = .66). Considerable intrahost Mtb mutation rates were present at recurrence among patients with DM in India. One-fourth of patients with DM had exogenous reinfection at recurrence.