Microvascular and macrovascular dysfunction plays an important role in the pathogenesis of diabetic vascular disease. Twenty-nine older patients with type 2 diabetes were randomly assigned into the land-based (LB; n = 14) or water-based (WB; n = 15) groups. Both groups completed supervised aerobic cycling exercises three times per week for 12 weeks. The WB group performed cycling exercise training in warm water (36 °C) immersed to the hip level. After 12 weeks, blood glucose concentration and insulin resistance did not change but hemoglobin A1c levels decreased (P < .05) in both groups. Plasma nitric oxide concentrations increased (P < .05) in both groups. Flow-mediated dilation in the popliteal artery increased and arterial stiffness decreased (P < .05) in both exercise groups. Indices of microvascular reactivity improved (P < .05) only in the WB group. The benefits of warm water-based training were similar in general, and superior in some measures, to the more established land-based cycling exercise.