Myotonic dystrophy type I (DM1) is an autosomal dominant multisystem disorder characterized by myotonia and muscle weakness. Type 2 diabetes (T2D) and cancer have been shown to be part of the DM1 phenotype. Metformin, a well‐established agent for the management of T2D, is thought to have cancer‐preventive effects in the general population. In our study, we aimed to assess the association between T2D, metformin use and the risk of cancer in DM1 patients. We identified a cohort of 913 DM1 patients and an age‐, sex‐ and clinic‐matched cohort of 12,318 DM1‐free controls from the UK Clinical Practice Research Datalink, a large primary care records database. We used Cox regression models to assess cancer risk in T2D patients who were metformin users or nonusers compared to patients without T2D. Separate analyses were conducted for DM1 patients and controls. T2D was more prevalent in DM1 than in controls (8% vs. 3%, p < 0.0001). DM1 patients with T2D, compared to those without T2D, were more likely to develop cancer (hazard ratio HR = 3.60, 95% confidence interval CI = 1.18–10.97; p = 0.02), but not if they were treated with metformin (HR = 0.43, 95% CI = 0.06–3.35; p = 0.42). Among controls, we observed no significant associations between T2D and cancer risk in either users or nonusers of Metformin (HR = 1.28, 95% CI = 0.91–1.79; p = 0.16 and HR = 1.13, 95% CI = 0.72–1.79; p = 0.59, respectively). These results show an association between T2D and cancer risk in DM1 patients and may provide new insights into the possible benefits of Metformin use in DM1. What's new? Recent evidence suggests that myotonic dystrophy type I (DM1), an inherited nucleotide repeat disorder, is a cancer predisposition syndrome. However, the underlying pathological mechanisms and cancer‐predisposing risk factors remain unknown. Here, type 2 diabetes (T2D) and metformin were investigated for potential associations with cancer risk in DM1 patients. T2D was found to be more prevalent in DM1 patients than controls. DM1 patients with T2D were at increased risk of developing cancer. By contrast, cancer risk was not elevated in DM1‐T2D patients taking metformin. Further investigation of metformin use and cancer in DM1 patients could yield important insights into DM1‐related cancer prevention.