Purpose: We examined whether diabetes and diabetes treatment are associated with MD in a cohort study of Danish women above age of 50 years. Methods: Study cohort consisted of 5,644 women (4,500 postmenopausal) who participated in the Danish Diet, Cancer, and Health cohort (1993–1997) and subsequently attended mammographic screening in Copenhagen (1993–2001). We used MD assessed at the first screening after the cohort entry, defined as mixed/dense or fatty. Diabetes diagnoses and diabetes treatments (diet, insulin, or oral antidiabetic agents) were self-reported at the time of recruitment (1993–1997). The association between MD and diabetes was analyzed by logistic regression adjusted for potential confounders. Effect modification by menopausal status and body mass index (BMI) was performed by introducing an interaction term into the model and tested by Wald test. Results: Of 5,644 women with mean age of 56 years, 137 (2.4%) had diabetes and 3,180 (56.3%) had mixed/dense breasts. Having diabetes was significantly inversely associated with having mixed/dense breasts, in both, the crude model (odds ratio; 95% confidence interval: 0.33; 0.23–0.48), and after adjustment for adiposity and other risk factors (0.61; 0.40–0.92). Similar inverse associations were observed for 44 women who controlled diabetes by diet only and did not receive any medication (0.56; 0.27–1.14), and 62 who took oral antidiabetic agents only for diabetes (0.59; 0.32–1.09), while women taking insulin had increased odds of mixed/dense breasts (2.08; 0.68–6.35). There was no effect modification of these associations by menopausal status or BMI. Conclusions: Having diabetes controlled by diet or oral antidiabetic agents is associated with a decrease in MD, whereas taking insulin is associated with an increase in MD.