Diabetes affects over 25 million people and is characterized by hyperglycemia resulting from a lack of insulin or reduced insulin sensitivity. A serious complication of diabetes is the increase in fracture risk observed in both type 1 and type 2 diabetic patients. This review focuses on some of the cellular and mechanistic causes of diabetes-induced fracture risk. Type 1 and type 2 diabetes most likely have unique and overlapping mechanisms of bone loss. While type 1 diabetes is associated with reduced bone mineral density, this is not usually seen in type 2 diabetes. Hyperglycemia, present in both type 1 and 2 diabetes, alters bone matrix proteins such as collagen I through nonenzymatic glycation, which can decrease bone toughness and increase fracture risk even in the absence of bone loss. Diabetes is also associated with increased inflammation and altered adipokine and calcitrophic hormone levels, which further contribute to bone pathophysiology. As medical advances significantly lengthen patient lifespan, exposure to diabetic conditions increases and correspondingly so do disease complications. Further research to identify molecular pathways in diabetes-associated bone pathology will provide the basis for therapeutic targets/directions to increase treatment options and improve patient health and well-being.