The effect of diabetes on the red blood cell (RBC) deformability and its association with histological vascular changes was investigated in 35 streptozotocin-induced diabetic Wistar rats in a 30-day experiment and compared to 10 controls. RBC deformability was significantly impaired in the diabetic rats on day 5 (p < 0.001) and continued to deteriorate until day 20. On the 20 (th) day, the diabetic rats were randomly divided into two groups (group A: insulin-treated; group B: non-insulin-treated). A slight, non-significant (p = 0.20) improvement in RBC deformability was noticed in the insulin-treated group. In vitro incubation of RBCs with insulin did not improve the acquired RBC rigidity in either diabetic group. In contrast, it caused a significant reduction in RBC-deformability in the controls. On day 30, histological examination of arterial specimens from various sites revealed moderate to significant thickening in medium- and small-size artery and arteriole walls in both diabetic groups, with no evidence of diabetes-related changes in large, elastic-type arteries. No vascular changes were noticed in nine diabetic rats that succumbed between days 10 and 15. The results of this study indicate that reduced RBC deformability is an early manifestation of abnormal blood rheology in experimental diabetes, and precedes the evolution of vascular changes.