There are approximately 1.3 million patients in Australia with diabetes. Conflicting reports exist in the literature as to the effect of diabetes on the outcomes of colorectal cancer patients. We hypothesized that patients with diabetes would have poorer perioperative outcomes, and that diabetes was an independent risk factor for both 30-day mortality and perioperative morbidity. The aim of this study was to assess the impact of diabetes on perioperative colorectal cancer surgery outcomes, as compared to a diabetes-free reference population, and to examine factors affecting perioperative risk. We conducted an analysis of a prospectively collected, clinician-led colorectal cancer database of patients from 2010-2015. Patients with diabetes were compared to patients without diabetes on a range of perioperative outcomes. Pearson χ-squared tests, Wilcoxon rank sum tests and t-tests were employed for univariate analyses. Confounding factors were controlled for by separate logistic and linear regression analyses. The Huber-White Sandwich Estimator was used to calculate robust standard errors. A total of 1725 patients were analysed over 1745 treatment episodes in the study period with 267 patients (268 episodes) with diabetes studied. Diabetes contributed to medical, surgical complications, and increased length of inpatient stay in univariate analyses. Multivariable analysis adjusted for variables independently associated with each outcome revealed that diabetes was an independent contributor to an increased risk of surgical complications, with no significant effect on medical complications, return to the operating room, 30-day mortality, or readmission within 30 days. In this study, where overall baseline morbidity and mortality levels are low, the effect of diabetes alone on perioperative surgical outcomes appears to be overstated with control of associated perioperative risk factors such as cardiac, renal and respiratory factors being more important.