Despite the mechanistic potential of sodium-glucose cotransporter 2 inhibitor (SGLT2i) to improve neurologic outcomes, the efficacy of SGLT2i in neurodegenerative disorders among patients with type 2 diabetes is not well established. This population-based cohort study aimed to investigate the association of SGLT2i use with risks of incident dementia and Parkinson disease (PD) in patients with type 2 diabetes. This was a retrospective examination of data from a cohort of 1,348,362 participants with type 2 diabetes (≥40 years), who started antidiabetic drugs from 2014 to 2019, evaluated using the Korean National Health Insurance Service Database. Propensity score matching (1:1; SGLT2i to other oral antidiabetic drugs [OADs]) produced a cohort of 358,862 participants. Primary outcomes were the individual incidence of Alzheimer disease (AD), vascular dementia (VaD), and PD. Secondary outcomes were all-cause dementia (AD, VaD, and other dementia) and a composite of all-cause dementia and PD. Cox proportional hazards models were used to investigate the association between SGLT2i use and the risks of dementia and PD. From the 358,862 participants analyzed (mean [SD] age, 57.8 [9.6] years; 58.0% male), 6,837 incident dementia or PD events occurred. Regarding the individual endpoints, SGLT2i use was associated with reduced risks of AD (adjusted hazard ratio [aHR] 0.81, 95% CI 0.76-0.87), VaD (aHR 0.69, 95% CI 0.60-0.78), and PD (aHR 0.80, 95% CI 0.69-0.91) with a 6-month drug use lag period. In addition, use of SGLT2i was associated with a 21% lower risk of all-cause dementia (aHR 0.79, 95% CI 0.69-0.90) and a 22% lower risk of all-cause dementia and PD than use of other OADs (aHR 0.78, 95% CI 0.73-0.83). The association between the use of SGLT2i and the lowered risk of these neurodegenerative disorders was not affected by sex, Charlson Comorbidity Index, diabetic complications, comorbidities, and medications. Sensitivity analysis further adjusting for bioclinical variables from health screening tests, including blood pressure, glucose, lipid profiles, and kidney function, yielded generally consistent results. In this nationwide population-based study, SGLT2i use significantly reduced the risks of neurodegenerative disorders in patients with type 2 diabetes independent of various factors including comorbidities and bioclinical parameters. This study provides Class II evidence that SGLT2 antidiabetic drugs decrease the risk of dementia and PD in people with diabetes.