Diabetic patients carry a four- to five-fold increased risk of heart failure. Hyperglycaemia plays a central role in the pathogenesis of diabetic cardiomyopathy. Diabetic cardiomyopathy represents a distinct structural and functional disorder of the myocardium characterized by cardiac hypertrophy and an increased myocardial stiffness. At an early stage, diabetic cardiomyopathy is manifested by diastolic heart failure with preserved ejection fraction. In some patients, diastolic dysfunction may progress to heart failure with reduced ejection fraction and result in overt systolic heart failure. Diastolic dysfunction can accurately be diagnosed by echocardiography and BNP measurement in daily clinical practice. Early treatment is prognostically important. Optimal control of blood glucose levels and blood pressure is beneficial. So far metformin is the only antidiabetic agent not associated with harm in diabetic patients with heart failure. Incretin-based therapies potentially provide cardiovascular benefits. ACE inhibitors, angiotensin-1 receptor antagonists and beta-blockers should be preferred in heart failure therapy.