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OBJECTIVE -- This study assessed the effects of balance/strength training on falls risk and posture in older individuals with type 2 diabetes. RESEARCH DESIGN AND METHODS -- Sixteen individuals with type 2 diabetes and 21 age-matched control subjects (aged 50-75 years) participated. Postural stability and falls risk was assessed before and after a 6-week exercise program. RESULTS -- Diabetic individuals had significantly higher falls risk score compared with control subjects. The diabetic group also exhibited evidence of mild-to-moderate neuropathy, slower reaction times, and increased postural sway. Following exercise, the diabetic group showed significant improvements in leg strength, faster reaction times, decreased sway, and, consequently, reduced falls risk. CONCLUSIONS -- Older individuals with diabetes had impaired balance, slower reactions, and consequently a higher falls risk than age-matched control subjects. However, all these variables improved after resistance/balance training. Together these results demonstrate that structured exercise has wide-spread positive effects on physiological function for older individuals with type 2 diabetes. [ABSTRACT FROM AUTHOR]