Cardiorespiratory fitness and mitochondrial oxidative capacity are associated with reduced walking speed in older adults, but their impact on walking speed in older adults with diabetes has not been clearly defined. We examined differences in cardiorespiratory fitness and skeletal muscle mitochondrial oxidative capacity between older adults with and without diabetes, as well as determined their relative contribution to slower walking speed in older adults with diabetes. Participants with diabetes (n = 159) had lower cardiorespiratory fitness and mitochondrial respiration in permeabilized fiber bundles compared with those without diabetes (n = 717), following adjustments for covariates including BMI, chronic comorbid health conditions, and physical activity. Four-meter and 400-m walking speeds were slower in those with diabetes. Mitochondrial oxidative capacity alone or combined with cardiorespiratory fitness mediated ∼20-70% of the difference in walking speed between older adults with and without diabetes. Additional adjustments for BMI and comorbidities further explained the group differences in walking speed. Cardiorespiratory fitness and skeletal muscle mitochondrial oxidative capacity contribute to slower walking speeds in older adults with diabetes.