The purposes of this study were to determine the effect of different degrees of severity of diabetic neuropathy on balance function, and to evaluate dynamic balance and functional performance in diabetes patients. Twenty-four subjects with diabetes mellitus were divided into three groups according to results of sensory nerve conduction study. All subjects were evaluated for dynamic balance which was measured using computerized dynamic posturography, and functional performance which was measured using the Berg balance scale. One-way analysis of variance was used to determine whether there were any statistically differences of dynamic balance function and functional performance among the three groups. The Spearrnan's rank correlation was used to determine statistical significance between dynamic balance and age. The results were as follows: 1. Dynamic balance measured using computerized dynamic posturography was significantly lower in the no response group than in the normal amplitude group (p<0.05). 2. Functional performance tested by the Berg balance scale was not statistically different among the three groups (p>0.05). 3. an inverse relationship was found between dynamic balance measured using computerized dynamic posturography and age (r=-0.68, p<0.05). These results suggest that patients with severe diabetic neuropathy have loss of dynamic balance function. Therefore, patients with severe diabetic neuropathy need to have their balance evaluated and receive appropriate education.