To investigate temporal changes in mobility in community-based people with type 2 diabetes, Fremantle Diabetes Study Phase II (FDS2) data were analysed. The baseline assessment included the Timed Up and Go (TUG) test, which was repeated biennially for up to six years. Group-based trajectory modelling (GBTM) identified TUG trajectory groups in participants with ≥2 tests. Independent associates of group membership were assessed using multinomial regression. Of 1551 potential FDS2 participants, 1116 (72.0%; age 64.9 ± 11.0 years, 45.6% female) were included in the modelling. The best-fitting GBTM model identified two groups with linear, minimally changing trajectories (76.2% and 19.4% of participants; baseline TUG times 8 ± 2 and 12 ± 3 s, respectively), and a third (4.5%; baseline TUG 17 ± 5 s) with a TUG that increased over time then fell at Year 6, reflecting participant attrition. Both slower groups were older, more likely to be female, obese, and had greater diabetes-associated complications and comorbidities. Almost one-quarter of the FDS2 cohort had clinically relevant mobility impairment that persisted or worsened over six years, was multifactorial in origin, and was associated with excess late withdrawals and deaths. The TUG may have important clinical utility in assessing mobility and its consequences in adults with type 2 diabetes.