Use of far infrared (FIR) energy may improve peripheral circulation. This study aimed to determine whether FIR delivered through textiles improves peripheral microcirculation as measured by transcutaneous oximetry (TcPO2) in individuals with diabetes mellitus (DM). Methods A single-center, prospective, randomized, placebo-controlled, double-blinded, crossover study of 32 subjects with either type 1 or type 2 DM. An active FIR wrap followed by a placebo wrap (or vice versa) was applied to the arm, calf, ankle, and forefoot for 60 min each with continuous TcPO2 measurements. The treatment effect of the active versus placebo wrap was estimated using a linear mixed effect model adjusted for period, sequence, baseline value, and anatomic site. Results The active FIR wrap increased mean TcPO2 at the arm (2.6 ± 0.8 mmHg, p = .002), calf (1.5 ± 0.7 mmHg, p = .03), and ankle (1.7 ± 0.8 mmHg, p = .04) and composite of all sites (1.4 ± 0.5 mmHg, p = .002) after 60 min. The estimated treatment effect was significant for the active FIR wrap at the calf (1.5 ± 0.7 mmHg, p = .045) and in composite of all sites (1.2 ± 0.5 mmHg, p = .013). Conclusion Short-term exposure to FIR textiles improves peripheral tissue oxygenation in patients with diabetes.