Hepatic encephalopathy (HE) is one of the major complications of cirrhosis, and its presence is associated with poor survival. Several risk factors for HE are well established, including age, history of HE, portosystemic shunts, or poorer liver function. In recent years, diabetes mellitus (DM) has emerged as another potential risk factor for the development of HE. This may be important for many patients, as the incidence of type 2 DM (T2DM) is increasing worldwide and, consequently, the incidence of NAFLD-related cirrhosis is rising simultaneously. In addition, DM is a critical factor in the progression of other liver diseases, such as alcohol-related liver disease. Thus, the number of patients with cirrhosis and comorbid T2DM will also increase. To date, the prevalence of DM already ranges between 22 - 40% in patients with cirrhosis. DM-associated factors that may influence the risk of HE include systemic inflammation, insulin resistance with increased muscle protein breakdown as well as autonomic dysfunction with prolonged intestinal transit time and small intestinal bacterial overgrowth. Currently, the evidence for an association between DM and both minimal and overt HE is weak and it seems likely that only poor glycemic control has an impact on HE risk. In addition, there are some early signs indicating that DM may impair the response of patients with HE to pharmacological therapies such as rifaximin. Thus, improvements in the management of glycemic control may be a candidate future target to reduce the risk of HE. In this concise review, we summarize the current evidence on the association between DM and HE and its potential future implications.