Polyunsaturated fatty acids (PUFA) correlate with risk of dyslipidemia and cardiovascular diseases. Fatty acid desaturase (FADS) single nucleotide polymorphisms (SNPs) modulate circulating PUFA concentrations. This study examined influence of FADS1 and FADS2 genetic variants on desaturase activities and blood lipid concentrations in type 2 diabetes patients, and further assessed their interrelationships. Selected SNPs (FADS1: rs174547, rs174548, rs174550; FADS2: rs174575, rs174576, rs174583, rs498793 and rs2727270) were genotyped in 820 type 2 diabetes patients and compared with those reported in the HapMap. Patient subgroups (n = 176) without taking lipid-lowering medicine were studied to assess influence of tag SNPs including rs174547, rs174575, rs498793 and rs2727270 on delta-5 desaturase (D5D: 20:4 (n-6)/20:3 (n-6)) and delta-6 desaturase (D6D:18:3 (n-6)/18:2 (n-6)) activities, and blood lipids. FADS1 rs174547 TT/TC/CC and FADS2 rs2727270 CC/CT/TT were significantly (p for trend < 0.05) associated with reduced HDL-C, D5D and D6D activities. Upon adjustment for confounders, D5D (p = 0.006) correlated significantly and D6D marginally (p = 0.07) correlated with increased HDL-C levels, whereas rs174547 and rs2727270 polymorphisms were not associated. D6D andD5D activities may play a role in modulating HDL-C levels in type 2 diabetes. Future studies with larger sample sizes are needed to investigate how FADS genetic variations interact with desaturase activities or PUFAs in the metabolism of lipoproteins in diabetic patients.