Exogenous C-peptide administration has beneficial effects in many of the tissues commonly affected by diabetic complications. Diabetes-induced circulatory impairments such as decreased blood flow are prevented by C-peptide, possibly via Ca2+-mediated effects on nitric oxide release. C-peptide also improves diabetes-induced erythrocyte deformability, which likely improves oxygen availability and uptake in affected tissues. Furthermore, C-peptide prevents diabetic neuropathy via improvements of endoneural blood flow and by preventing axonal swelling. In the kidney, C-peptide normalizes the diabetes-induced increase in oxygen consumption via inhibition of the Na+/K+-ATPase. Surprisingly, C-peptide has also been shown to prevent complications in patients with type II diabetes. Taken together, these results may indicate that C-peptide treatment has the potential to reduce the prevalence of diabetic complications. In this paper, the current knowledge regarding these beneficial effects of C-peptide administered to diabetic subjects will be reviewed briefly.