Accumulating evidence implicates inflammation as a potential pathway in the pathogenesis of type 2 diabetes. The objective of the present study was to assess the ability of C-reactive protein (CRP) to predict the development of diabetes in middle-aged men in the West of Scotland Coronary Prevention Study. Baseline plasma samples for CRP measurement were available for 5,245 men of whom 127 were classified as having a transition from normal glucose control to overt diabetes during the study, based on American Diabetes Association criteria. Baseline CRP was an important predictor of the development of diabetes in univariate analysis (hazard ratio [HR] for an increase of 1 SD = 1.55; 95% CI 1.32–1.82; P < 0.0001). In multivariate analysis, CRP remained a predictor of diabetes development (HR 1.30; 95% CI 1.07–1.58; P = 0.0075) independent of other clinically employed predictors, including baseline BMI and fasting triglyceride and glucose concentrations. Moreover, there was a graded increase in risk across CRP quintiles throughout the study, evident at even 1 year of follow-up. The highest quintile (CRP >4.18 mg/l) was associated with a greater than threefold risk of developing diabetes (HR 3.07; 95% CI 1.33–7.10) in a multivariate analysis at 5 years. Thus, CRP predicts the development of type 2 diabetes in middle-aged men independently of established risk factors. Because CRP, the most commonly used acute-phase protein in clinical practice, is very stable in serum, our observations have clinical potential in helping to better predict individuals destined to develop type 2 diabetes. They also add to the notion that low-grade inflammation is important in the pathogenesis of type 2 diabetes.