The aims of this study were to: (i) review concepts of disease management; (ii) review and evaluate studies in the areas of cost and outcomes of diabetes mellitus; and (iii) assess the cost-effectiveness of diabetic care that can control glucose levels and reduce complications. Diabetes mellitus is a chronic disease affecting approximately 16 million Americans that accounts for about 5.8% of the population. Only half of these people have been specifically diagnosed as having diabetes mellitus, but medical costs to treat diabetes accounted for 5.8 percent of total health care expenditures in 1992. This disproportionate amount indicates that diabetic patients use more health resources because of complications than do patients with other diseases. Although the Diabetes Control and Complication Trial found that the control of glucose levels can delay or prevent the complications of diabetes, more studies in the areas of the economic and outcomes aspects of diabetes mellitus should be extensively conducted to discover a cost-effective way to treat diabetic patients and to reduce complications.The search was conducted by reviewing and assessing papers on the cost, outcomes, and cost-effectiveness of diabetes mellitus from Medline and Health. Other relevant papers were also reviewed and included in this study. Diabetes mellitus has a significant economic impact in the United States and in many other countries. Because it was proved that the control of glucose levels can delay or prevent complications of diabetes, early detection and treatment could be a cost-effective way to treat type I or type II patients, from the viewpoint of society or government. It was also found that a patient's quality of life was diminished by diabetes and his quality of life is sensitive to many variables. Diabetes disease management could be a vehicle for improving patient outcomes and containing costs over the course of diabetes treatment.