Long bone fractures in diabetics are slower to heal, have an increased risk of developing non-union and demonstrate greater potential of infection and perioperative complications compared to non-diabetics. The causative aberrant bone mineral density and insufficient bone microstructure of diabetic patients are thought to result from altered osteoblast and osteocyte function, increased bone marrow adiposity, decreased progenitor osteo- and chondral differentiation potential and increased pro-inflammatory cytokine circulation. It is therefore reasonable to hypothesize that the root cause of faulty diabetic bone homeostasis and fracture repair is a reduced population of bone marrow progenitor cells and/or their decreased osteochondral capacity complicated by their repressed neo-vascular potential. The potential of transplanted mesenchymal stem cells with a scaffold to support callus formation through the creation of de novo bone in hyperglycemia has been reported. However, there are minimal supporting pre-clinical and clinical investigations confirming these findings. Clinical trials have instead examined mesenchymal stem cell transplantation to slow disease progression, support -cell viability and function and restore glucose homeostasis while the direct application of allogenic non-diabetic mesenchymal stem cells at the site of orthopaedic injury remains un-investigated. Here, the literature supporting the application of mesenchymal stem cells in diabetic fracture repair is reviewed including the process of dysfunctional diabetic fracture healing, osteoblast dysregulation and the effect of the hyperglycaemic environment on progenitor cell number and performance with a view to translating the preclinical knowledge base to the administration of mesenchymal stem cells in diabetic fracture repair.