Abstract Context Fracture risk is higher in type 2 diabetes (T2D) for a given bone mineral density (BMD) level. Increased oxidative stress in T2D induces diabetic complications and may affect T2D bone fragility. Objective To investigate whether the levels of plasma F2-isoprostanes, a reliable oxidative stress marker, are associated with incident clinical fracture risk in older adults with diabetes. Design and Setting An observational cohort study was conducted in a well-characterized cohort from Health, Aging, and Body Composition study. Participants Older black and white ambulatory adults with baseline plasma F2-isoprostanes measurements (baseline age 70-79 years, T2D: N=132; non-diabetes: N=571) were selected from the study cohort of 3075 individuals. Main Outcome Measures Incident clinical fractures. Results In the Cox proportional hazard model with multivariate adjustments (including BMD, medications, and other risk factors), a 93% increase in incident clinical fracture risk was significantly associated with each SD increase in log plasma F2-isoprostanes in the T2D group (HR: 1.93, 95% CI 1.26-2.95, p=0.002), but there was no evidence of an association in the non-diabetes group (HR: 0.98, 95% CI 0.81-1.18, p=0.79, p for interaction < 0.001). Log plasma F2-isoprostanes were moderately correlated with a decline in baseline total hip BMD (r=-0.25, p=0.003), and with a 4-year decrease in total hip BMD (r=-0.28, p=0.008) in T2D. There was no evidence of correlation between log plasma F2-isoprostanes and circulating glycoxidation markers or bone turnover markers in either group. Conclusions Plasma F2-isoprostanes levels in individuals with diabetes are associated with increased incident clinical fracture risk independently of baseline BMD.