Pneumococcal vaccination is recommended 5-yearly for high-risk groups including people aged ≥65 years and Aboriginals/Torres Strait Islanders. Diabetes doubles the incidence of pneumonia hospitalisation. We have, therefore, examined whether i) high-risk patients with type 2 diabetes (T2DM) receive pneumococcal vaccination, and ii) vaccination reduces the incidence of severe pneumonia in T2DM. The Fremantle Diabetes Study Phase II (FDS2) includes 1,551 T2DM participants followed through validated hospital morbidity/mortality databases. At baseline in 2008-2011, T2DM participants were of mean±SD age 65.7±11.6 years and 51.9% were males. Self-reported pneumococcal vaccination status at entry was available for 1465 (94.5%). Of these, 624 (42.6%) had been vaccinated in the previous 5 years including 61.7% in high-risk groups. During 3.6±1.1 years of follow-up for first pneumonia hospitalisation, death or end-June 2013, 72 (4.6%) were hospitalised for 85 pneumonia episodes while 9 died from pneumonia. The incidence rate (95% CI) for first hospitalisation/death due to pneumonia was 16.8 (13.6-20.5)/1,000 patient-years. In Cox proportional hazards modelling, this endpoint was more likely with hospitalisation for/with pneumonia before entry, eGFR ≥90 or <60 mL/min, and major depression. After adjusting for this most parsimonious model, self-reported pneumococcal vaccination was not predictive (hazard ratio (95% CI): 0.76 (0.47-1.26); P=0.29). In a Poisson model of risk factors for multiple pneumonia hospitalisations (69 had one, 5 had two, 5 had three), vaccine status was similarly not independently predictive (incidence rate ratio (95% CI): 0.97 (0.61-1.55); P=0.91). In community-based Australians with T2DM, pneumococcal vaccine coverage is sub-optimal with more than one third of those in recognised high-risk groups remaining unvaccinated. Although pneumococcal vaccination did not appear to prevent incident hospitalisations for/death from pneumonia, further follow-up with increased numbers of events is warranted.