Medical systems and care for diabetes have changed greatly in Taiwan in recent years. This study investigated mortality trends in patients with diabetes in Taiwan from 2000 to 2009. Methods: We linked the National Health Insurance (NHI) claims database, which contains data on 99% of the population of Taiwan, to the National Death Registry and Cancer Registry. Patients were classified as having diabetes if they had at least one hospital admission or three or more outpatient visits with a diabetes diagnostic code in each calendar year. Mortality data from the Collaboration Center of Health Information Application were used to estimate age- and sex-specific mortality rates, all-cause mortality, and life expectancy (LE). Results: The mortality of patients with diabetes in Taiwan decreased continuously from 2000 to 2009 for both sexes and all age groups; the mortality rate was generally higher for men than for women (3.92% vs. 3.29% in 2000; 3.64% vs. 3.11% in 2005, and 3.12% vs. 2.71% in 2009, all p < 0.05). Diabetic patients had a shorter LE than the entire population, although this difference decreased over time. The estimated loss of life due to diabetes was 6.1 years in women and 5.3 years in men in 2009, when diabetes was diagnosed at the age of 40. The four major causes of death were diabetes, malignancies, heart diseases, and cerebrovascular diseases. Conclusion: The mortality of diabetic patients in Taiwan decreased from 2000 to 2009. Although patients with diabetes had a shorter LE than the entire population, the difference decreased over time.