Abstract Aim The purpose of the present study was to distinguish the effects of both diabetes mellitus type 2 (DM2) and diabetic polyneuropathy (DPN) on mobility, muscle strength and health related quality of life (HR-QoL). Methods DPN patients ( n = 98), DM2 patients without DPN (DC) ( n = 39) and healthy subjects (HC) ( n = 19) performed isometric and isokinetic lower limb muscle strength tests. Mobility was determined by a timed up and go test (TUGT), a 6 min walk test and the physical activity scale for the elderly questionnaire. HR-QoL was determined by the SF36 questionnaire. Results DPN patients had moderate polyneuropathy. In both DPN and DC patients leg muscle strength was reduced by 30–50% compared to HC. Muscle strength was correlated with mobility tests, and reduced muscle strength as well as impaired mobility were associated with a loss of HR-Qol (all p < 0.05). We did not observe major differences in muscle strength, mobility (except for the TUGT, p < 0.01) and HR-QoL between diabetic patients with and without DPN. Conclusion DM2 patients, with and without DPN, have decreased maximal muscle strength in the lower limbs and impaired mobility. These abnormalities are associated with a loss of HR-QoL. The additional effect of moderate DPN was small in our patients.