Sleep-disordered breathing (SDB) and diabetes mellitus (DM) are often concomitant; however, data on the impact of SDB on mortality in the population with diabetes remain scarce. The population from the Sleep Heart Health Study, a multicenter prospective observational study representing 5780 patients with polysomnography and mortality data, including 453 patients with DM, was analyzed to assess the impact of SDB variables and the presence of DM on all-cause, cardiovascular disease (CVD), and non-CVD associated mortality. Survival analysis and proportional hazard regression models were used to calculate the adjusted hazard ratios (aHR) for mortality. Patients with DM and the average SpO2 >91.4% had significantly lower all-cause (aHR 0.52, CI 0.34-0.80) and CVD mortality risk (aHR 0.44, CI 0.22-0.87) as compared with patients with SpO2 below this value. Apnea-hypopnea index >31 (aHR 1.58, CI 1.10-2.28) and oxygen desaturation index >13.3 (aHR 1.58, CI 1.10-2.25) were associated with increased all-cause mortality in participants with DM on treatment. Sleep efficiency and proportion of rapid-eye movement (REM) sleep did not have any impact on mortality in patients with DM and thus differed significantly from individuals without DM, where increased all-cause mortality was observed in those with sleep efficiency <81.4% (aHR 0.77, CI 0.68-0.87) or REM sleep <14.9% (aHR 0.78, CI 0.68-0.89). Patients with diabetes on treatment and moderate to severe sleep-disordered breathing experience increased all-cause mortality. Reduced average oxygen saturation predicted both all-cause and cardiovascular death in the population with diabetes.