Objective: The development of both type I and type II diabetes after initiation of some atypical neuroleptics has been reported, primarily in studies involving small series of patients. This study used administrative data from a large national sample of patients with a diagnosis of schizophrenia to compare the prevalence of diabetes mellitus in patients receiving prescriptions for atypical and typical neuroleptics. Method: All outpatients with schizophrenia treated with typical and atypical neuroleptics over 4 months in 1999 in the Veterans Health Administration of the Department of Veterans Affairs (VA) were included in this study. Patients treated with atypical neuroleptics were those who received prescriptions for clozapine, olanzapine, risperidone, or quetiapine. Patients with a diagnosis of diabetes were also identified by using ICD-9 codes in VA administrative databases. The prevalence of diabetes mellitus across age groups and among patients receiving prescriptions for different atypical neuroleptics was examined with multiple logistic regression. Results: A total of 38,632 patients were included in the study: 15,984 (41.4%) received typical neuroleptics and 22,648 (58.6%) received any atypical neuroleptic (1,207 [5.3%] received clozapine; 10,970 [48.4%], olanzapine; 955 [4.2%], quetiapine; and 9,903 [43.7%], risperidone; 387 patients received prescriptions for more than one atypical neuroleptic). When the effects of age were controlled, patients who received atypical neuroleptics were 9% more likely to have diabetes than those who received typical neuroleptics, and the prevalence of diabetes was significantly increased for patients who received clozapine, olanzapine, and quetiapine, but not risperidone. However, for patients less than 40 years old, all of the atypical neuroleptics were associated with a significantly increased prevalence of diabetes. Conclusions: In this large group of patients with schizophrenia, receipt of a prescription for atypical neuroleptics was significantly associated with diabetes mellitus.