Foxo1 upregulation is linked to defective fracture healing under diabetic conditions. Previous studies demonstrated that diabetes upregulates Foxo1 expression and activation and diabetes impairs ciliogenesis resulting in defective fracture repair. However, the mechanism by which diabetes causes cilia loss during fracture healing remains elusive. We report here that streptozotocin (STZ)-induced type 1 diabetes mellitus (T1DM) dramatically increased Foxo1 expression in femoral fracture calluses, which thereby caused a significant decrease in the expression of IFT80 and primary cilia number. Ablation of Foxo1 in osteoblasts in OSXcretTAFoxo1f/f mice rescued IFT80 expression and ciliogenesis and restored bone formation and mechanical strength in diabetic fracture calluses. In vitro, advanced glycation end products (AGEs) impaired cilia formation in osteoblasts and reduced the production of a mineralizing matrix, which were rescued by Foxo1 deletion. Mechanistically, AGEs increased Foxo1 expression and transcriptional activity to inhibit IFT80 expression causing impaired cilia formation. Thus, our findings demonstrate that diabetes impairs fracture healing through Foxo1 mediated inhibition of ciliary IFT80 expression and primary cilia formation, resulting in impaired osteogenesis. Inhibition of Foxo1 and/or restoration of cilia formation has the potential to promote diabetes-impaired fracture healing.