Although the etiology of diabetic neuropathic pain remains enigmatic, two types of neuropathic pain are now recognized: nerve trunk pain following a discrete often vascular lesion as seen in ocular mononeuropathy and hyperalgesic pain as seen in diffuse involvement of peripheral sensory fibers. Our understanding of the causes of hyperalgesic pain has been furthered by studying structural changes in sural nerve biopsies from subjects with symptomatic neuropathy or by assessing biochemical changes that lead to positive symptoms. Recent evidence suggests that both small and large fibers are involved in painful neuropathy, and axonal atrophy may contribute to pain generation. The observation that acute painful neuropathy may follow either periods of unstable glycemic control or sudden improvement of control (“insulin neuritis”) suggests that blood glucose flux may precipitate pain. Sudden changes in glycemia may contribute to the generation of impulses in nociceptive fibers or even induce relative hypoxia and axonal atrophy. Pain might arise from ectopic impulses in dorsal root ganglion cells or may even be of spinal or central origin. Thus, a combination of structural and functional changes in peripheral nerve is most likely to lead to the generation of neuropathic pain.