Introduction: Dental implants are used routinely with high success rates in generally healthy individuals. By contrast, their use in patients with diabetes mellitus is controversial because altered bone healing around implants has been reported. This study examined the bone healing response around titanium implants placed immediately in rats with controlled and uncontrolled diabetes. Materials and Methods: Twenty rats were divided into the control, insulin-treated and diabetic groups. The rats received streptozotocin (60 mg/kg) to induce diabetes; animals in the insulin-treated group also received three units of subcutaneous slow-release insulin. A titanium implant ($1.2{ imes}3;mm$) was placed in the extraction socket of the maxillary first molar and bone block was harvested at 1, 2 and 4 weeks. Results: Bone formation around the implants was consistently (from 1 to 4 week post-implantation) slower for the diabetic group than the control and insulin-treated group. Bone morphogenesis in the diabetic rats was characterized by fragmented bone tissues and extensive soft tissue intervention. Conclusion: The immediate placement of titanium implants in the maxilla of diabetic rats led to an unwanted bone healing response. These results suggest that immediate implant insertion in patients with poorly controlled diabetes might be contraindicated.