Arginase can cause vascular dysfunction by competing with nitric oxide synthase for l-arginine and by increasing cell proliferation and collagen formation, which promote vascular fibrosis/stiffening. We have shown that increased arginase expression/activity contribute to vascular endothelial cell (EC) dysfunction. Here, we examined the roles of the two arginase isoforms, arginase I and II (AI and AII, respectively), in this process. Experiments were performed using streptozotocin-induced diabetic mice: wild-type (WT) mice and knockout mice lacking the AII isoform alone (AI(+/+)AII(-/-)) or in combination with partial deletion of AI (AI(+/-)AII (-/-)). EC-dependent vasorelaxation of aortic rings and arterial fibrosis and stiffness were assessed in relation to arginase activity and expression. Diabetes reduced mean EC-dependent vasorelaxation markedly in diabetic WT and AI(+/+)AII(-/-) aortas (53% and 44% vs. controls, respectively) compared with a 27% decrease in AI(+/-)AII (-/-) vessels. Coronary fibrosis was also increased in diabetic WT and AI(+/+)AII(-/-) mice (1.9- and 1.7-fold vs. controls, respectively) but was not altered in AI(+/-)AII (-/-) diabetic mice. Carotid stiffness was increased by 142% in WT diabetic mice compared with 51% in AI(+/+)AII(-/-) mice and 19% in AI(+/-)AII (-/-) mice. In diabetic WT and AI(+/+)AII(-/-) mice, aortic arginase activity and AI expression were significantly increased compared with control mice, but neither parameter was altered in AI(+/-)AII (-/-) mice. In summary, AI(+/-)AII (-/-) mice exhibit better EC-dependent vasodilation and less vascular stiffness and coronary fibrosis compared with diabetic WT and AI(+/+)AII(-/-) mice. These data indicate a major involvement of AI in diabetes-induced vascular dysfunction.