Abstract Background Individuals with diabetes are twice as likely to develop peripheral arterial disease (PAD), the manifestation of extensive atherosclerosis throughout the lower extremities. One putative determinant of PAD is the 677C>T polymorphism in the gene encoding methylenetetrahydrofolate reductase (MTHFR), which has previously been found to associate with various diabetic complications including retinopathy, nephropathy, atherosclerosis and coronary heart disease. The objective of this study was to investigate a possible role for the MTHFR 677C>T gene polymorphism with PAD in subjects with type 2 diabetes from an isolated aboriginal Canadian population. Methods The 677C>T MTHFR gene polymorphism was genotyped in 138 subjects of Oji-Cree descent. Participants were selected from a community-wide survey that included PAD assessment by ankle-brachial index (ABI) measurement, and also intermittent claudication assessment by the Rose questionnaire. Results MTHFR 677T allele carriers had an increased risk of PAD with an odds ratio of 3.54 (95% CI 1.01, 12.4), P = 0.049, after adjustment for age, sex, duration of diabetes, hypertension, current smoking habits, and use of insulin or oral treatment for diabetes. None of these additional co-variables was significantly associated with PAD. No association was found between MTHFR genotype and intermittent claudication. Conclusion The genetic influence of the MTHFR 677C>T genotype on diabetic PAD is modest, yet for the Oji-Cree it is a major risk factor in comparison to other traditional risk factors.