Background. Cathepsin D has been recently implicated in insulin resistance and cardiovascular disease. This study was designed to investigate the relationship between cathepsin D and newly diagnosed type 2 diabetes. Methods. Circulating cathepsin D levels and metabolic variables were measured in 98 cases and 98 controls. Myocardial performance index "Tei index" that reflects both left ventricular systolic and diastolic function was measured with Doppler echocardiography in cases. Results. Newly diagnosed type 2 diabetes demonstrated significantly higher circulating cathepsin D concentrations than controls (median level: 227 ng/ml versus 174 ng/ml, P < 0 01). In newly diagnosed type 2 diabetes, a significant correlation was found between cathepsin D levels and HOMA-IR (homeostatic model assessment of insulin resistance) (r = 0 25, P = 0 01). In contrast, no significant correlation was found between cathepsin D levels and clinical parameters in the control group (all P > 0 05). Interestingly, correlation analysis revealed a positive association between cathepsin D levels and Tei index in type 2 diabetes (r = 0 22, P = 0 03). Conclusions. Increased levels of circulating cathepsin D are closely linked with the presence of type 2 diabetes, and cathepsin D might serve as a novel biomarker for cardiac dysfunction in newly diagnosed type 2 diabetes.