Background: Left ventricular (LV) longitudinal diastolic functional reserve, assessed with the change of early diastolic mitral annular velocity (E���) during exercise, is abnormal in patients with diabetes without overt heart disease. However, its impact on clinical outcome has not been explored previously. We hypothesized that LV diastolic reserve could further stratify diastolic dysfunction, and have a prognostic significance in patients with type 2 diabetes. Method: Of 1,170 patients who were referred for diastolic stress echocardiography, 230 consecutive patients (mean age 58 years, male 103, mean ejection fraction 68 %) with type 2 diabetes were identified. LV diastolic function reserve (DFR, E���) was defined as the change of E��� from baseline to exercise. The primary end-point was a composite of all-cause death and hospitalization for heart failure. Result: The median follow-up duration was 34 months (range 3 to 63 months). Primary end-point occurred in 15 (6.2 %) of 230 patients during follow-up. Among the predictors that showed a significance in the univariate Cox analysis, including age, coronary artery disease history, renal insufficiency, LV mass index, LAVI, and ejection fraction, LV DFR (E���) was the most independent predictor of adverse outcomes in these patients. When patients were classified into two groups by the cut-off value of DFR at 50W of exercise in ROC curve (AUC 0.77, sensitivity 81 %, specificity 61 %), patients with DFR < 2.0 cm/s showed poorer clinical outcomes compared to those with DFR ��� 2.0 cm/s (p = 0.01). Conclusion: The assessment of LV diastolic functional reserve using exercise Doppler echocardiography is helpful in further stratifying diastolic dysfunction, and provides incremental prognostic information in patients with type 2 diabetes without overt heart disease.