Neuropathies of the peripheral and autonomic nervous systems affect up to half of all people with diabetes, and are major risk factors for foot ulceration and amputation. The aetiology is multifactorial: metabolic changes in diabetes may directly affect neural tissue, but importantly, neurodegenerative changes are precipitated by compromised nerve vascular supply. Experiments in animal models of diabetic neuropathy suggest that similar metabolic sequelae affect neurons and vasa nervorum endothelium. These include elevated polyol pathway activity, oxidative stress, the formation of advanced glycation and lipoxidation end products, and various pro-inflammatory changes such as elevated protein kinase C, nuclear factor κB and p38 mitogen activated protein kinase signalling. These mechanisms do not work in isolation but strongly interact in a mutually facilitatory fashion. Nitrosative stress and the induction of the enzyme poly (ADP-ribose) polymerase form one important link between physiological stressors such as reactive oxygen species and the pro-inflammatory mechanisms. Recently, evidence points to endoplasmic stress and the unfolded protein response as forming another crucial link. This review focuses on the aetiopathogenesis of neurovascular changes in diabetic neuropathy, elucidated in animal studies, and on putative therapeutic targets the majority of which have yet to be tested for efficacy in clinical trials.