The aim of the DIALA project was to demonstrate the feasibility of structured treatment and teaching programs for type 2 diabetic patients in order to improve the overall quality of care. The investigation was carried out in Upper Austria. The results and findings of structured treatment were evaluated as well as the associated costs of current diabetes management. 19 practitioners were recruited. From the beginning of January 2002 to the end of December 2003, a total of 343 diabetics were registered, and clinical and economic data were collected on all diabetic patients who visited the primary care offices during the period of 24 months. The aims of treatment were discussed between practitioners and patients, routine examinations were carried out quarterly, and all data were recorded using a diabetes care card. All the patients participating in the project were given the opportunity to take part in a diabetes self-management teaching programme. There was an obvious correlation between information and treatment on the one hand and clinical results, as measured by HbA1c, blood pressure levels and body weight on the other. Costs were calculated in a standardized way, and showed a reduction in expense as a result of the structured treatment and cost savings amounting to EUR 620 per annum and patient. The hospital admission rate for cases with diabetes mellitus as the primary diagnosis was considerably reduced. Our results indicate that establishing a structured treatment and teaching programme can improve the quality of diabetes therapy in primary care and influence the rate at which physicians admit patients to hospital.