Aims To determine health-related quality of life (HRQoL) in the first year following diagnosis of Type 2 diabetes among newly diagnosed patients in general practice compared with patients detected by targeted population screening. Methods The study population consisted of 49 newly diagnosed patients in general practice and 116 screening-detected patients. HRQoL was operationalized as symptom distress, perceived health status and emotional well-being, that were assessed prospectively similar to2 weeks, 6 months and 12 months after the diagnosis of Type 2 diabetes, with the Type 2 Diabetes Symptom Checklist (DSC-type 2), the Short Form 36 (SF-36) and the Well-Being Questionnaire (W-BQ12), respectively. Results The DSC-type 2 total score (range 0-4) improved significantly within newly diagnosed patients in general practice (median at similar to2 weeks, 6 months and 12 months; 0.56, 0.21, 0.26; P = 0.000) and not within screening-detected patients (0.24, 0.24, 0.29; P = 0.093). Descriptives showed that newly diagnosed patients in general practice compared with screening-detected patients had consistently worse mean scores on all SF-36 mental health subscales Social Functioning, Role Emotional, Mental Health, Vitality, and all W-BQ12 scales at each time point. The differences were statistically significant for Role Emotional, Mental Health, Vitality (SF-36), and General well-being (W-BQ12). The SF-36 General Health (F = 3.7, P = 0.028) and Vitality (F = 4.5, P = 0.012) scores of newly diagnosed patients in general practice improved significantly over time, compared with screening-detected patients. Conclusions Newly diagnosed patients in general practice compared with screening-detected patients reported more diabetes-related symptom distress shortly after the diagnosis, and a consistently worse mental health status at each time point. Improved Vitality scores in newly diagnosed patients in general practice in the first year following diagnosis of Type 2 diabetes suggest a positive effect of diabetes treatment on HRQoL.