The objectives of this study were to define clinical outcomes following distal bypass graft occlusion in diabetic patients and identify factors predictive of limb loss. A retrospective review was conducted of all distal graft occlusions over a 5-year period in diabetic patients. Popliteal grafts, perioperative (30 days) failures, and redo distal bypasses were excluded. Eighty grafts were studied (43 cases done for ulcers, 31 for gangrene, and 6 for rest pain). Time to occlusion averaged 13 ± 17 months post-bypass (median 6 months). Interventions following graft occlusion (lysis, thrombectomy, revision, or new bypass) were carried out in only 26 cases, leading to limb salvage in 11 cases (42%). This compares to a limb salvage rate of 54% in the 54 cases where no intervention was done (p = NS). The overall amputation rate was 50% (14 AKAs and 26 BKAs). The interval between graft occlusion and amputation averaged 2 ± 2 months. Limbs saved were followed an average of 14 ± 11 months after graft occlusion. The presence of a foot wound (new or old) was associated with a higher likelihood of amputation (67% vs. 32% for cases with no foot wounds at the time of bypass failure; p < 0.005). In cases requiring an amputation, the toebrachial index averaged 0 ± 0 post-bypass failure vs. 0.2 ± 0.2 in cases where limbs were saved (p < 0.05). Patients with congestive heart failure or who were nonambulatory at the time of graft occlusion were more likely to end up with an amputation (p < 0.05). Limb loss was also more likely when gangrene had been the initial operative indication. No other factors were predictive of limb loss, including vein configuration, inflow or outflow level, prior bypass revision, known graft stenosis, time to occlusion, age, gender, other medical conditions, pre- or post-bypass ABI or TBI, graft velocities, or use of anticoagulants. Limb loss following primary distal bypass failure in diabetics is high. Repeat interventions have limited success. The findings justify aggressive programs of graft maintenance, and vigorous attempts at early closure of foot wounds.