Aims This study investigated autonomic nervous system function in subjects with diabetes during exercise and recovery. Methods Eighteen type 2 diabetics (age 55±2years) and twenty healthy controls (age 51±1years) underwent two 16-min bicycle submaximal ECG stress tests followed by 45min of recovery. During session #2, atropine (0.04mg/kg) was administered at peak exercise, and the final two minutes of exercise and entire recovery occurred under parasympathetic blockade. Plasma catecholamines were measured throughout. Parasympathetic effect was defined as the difference between a measured parameter at baseline and after parasympathetic blockade. Results The parasympathetic effect on the RR interval was blunted (P =.004) in diabetic subjects during recovery. Parasympathetic effect on QT–RR slope during early recovery was diminished in the diabetes group (diabetes 0.13±0.02, control 0.21±0.02, P =.03). Subjects with diabetes had a lower heart rate recovery at 1min (diabetes 18.5±1.9bpm, control 27.6±1.5bpm, P <.001). Conclusions In subjects with well-controlled type 2 diabetes, even with minimal evidence of CAN using current methodology, altered cardiac autonomic balance is present and can be detected through an exercise-based assessment for CAN. The early post-exercise recovery period in diabetes was characterized by enhanced sympathoexcitation, diminished parasympathetic reactivation and delay in heart rate recovery.