BackgroundType 2 Diabetes Mellitus is a serious metabolic disease that is often associated with vascular complications. There are 1.9 million people living with Diabetes in Ethiopia; diabetes mellitus is found to be the ninth leading cause of death related to its complications. Although the rate of vascular complications continues to rise, there is limited information about the problem. This study aimed to estimate the incidence and predictors of vascular complications among type 2 diabetes mellitus patients at University of Gondar Referral Hospital.MethodsInstitution based retrospective follow-up study was conducted at University of Gondar Referral Hospital with 341 newly diagnosed type 2 DM patients from September 2005 to March 2017 and the data were collected by reviewing their records. Schoenfeld residuals test and interaction of each covariate with time were used to check proportional hazard assumption. The best model was selected by using Akaike Information Criteria (AIC). Hazards ratio (HR) with its respective 95% confidence interval were reported to show strength of association.ResultThe selected patients were followed retrospectively for a median follow up time of 81.50 months (Inter quartile range (IQR) = 67.2–103.3). The mean age (± Standard deviation (SD)) of patients at baseline was 51.7(SD: ±11.5 years) and 57.48% were females. The incidence rate of vascular complications was 40.6 cases/ 1000 person years of observation. The significant predictors for vascular complications where found to be male sex (Adjusted hazard ratio (AHR) = 0.50, 95% CI: 0.27, 0.94), having hypertension at baseline(AHR = 3.99, 95% CI: 1.87, 8.56), positive protein urea at base line (AHR = 1.69, 95% CI: 1.03, 2.78), high density lipoprotein cholesterol(HDL-C) level ≥ 40 mg per deciliter (mg/dl) (AHR = 0.43, 95% CI: 0.24, 0.77), low density lipoprotein cholesterol(LDL-C) level > 100 mg/dl (AHR = 3.05, 95% CI: 1.47, 6.35) and triglyceride > 150 mg/dl (AHR = 2.74, 95% CI: 1.28, 5.84).ConclusionThe incidence of vascular complications among type 2 diabetes patients remains a significant public health problem. Hypertension at baseline, LDL-C > 100 mg/dl, triglyceride > 150 mg/dl, HDL-C ≥ 40 mg/dl and male sex were significant predictors of vascular complication. In the light of these findings targeted interventions should be given to diabetes patients with hypertension comorbidity and dyslipidemia at follow up clinics.