Type 1 and type 2 diabetes are characterized by chronic inflammation; both diseases involve pancreatic islet inflammation, while systemic low-grade inflammation is a feature of obesity and type 2 diabetes. Long-term activation of the innate immune system impairs insulin secretion and action, and inflammation also contributes to macrovascular and microvascular complications of diabetes. However, despite strong preclinical evidence and proof-of-principle clinical trials demonstrating that targeting inflammatory pathways can prevent cardiovascular disease and other complications in patients with diabetes, there are still no approved treatments for diabetes that target innate immune mediators. Here, we review recent advances in our understanding of the inflammatory pathogenesis of type 1 and type 2 diabetes from a translational angle and point out the critical gaps in knowledge that need to be addressed to guide drug development.