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Diabetes‐related foot disease (DFD) is imposing an enormous burden on the health system and society due to the rapid growth of diabetes worldwide. Given the paucity of robust data on the disease burden of DFD in Australia, this study aimed to estimate the burden of disease due to DFD. The burden of DFD was estimated using the disability‐adjusted life‐years (DALY) approach. Data of 27 931 individuals aged 45 years and older with diabetes residing in New South Wales (NSW) from the 45 and Up Study survey were used in this study by linking it with the emergency department, hospital admissions and the deaths' registry data. The disease burden of DFD was estimated as 8915 DALY in NSW and 27 164 DALY in Australia in 2011. The burden was prominent among males and people aged 65 years and older. Most of the DALY (87%) was attributed to years of life lost or the fatal burden due to diabetes‐related lower limb amputation (DRLEA). The total monetary values of DALY of DFD for NSW and Australia were estimated at approximately AUD 2 billion and AUD 6 billion annually, respectively. Preventative and curative priorities should be given to DRLEA to reduce this burden and target males, especially those aged 65 years and older. [ABSTRACT FROM AUTHOR]