Type 2 diabetes is characterized by progressive beta-cell dysfunction. Family history of type 2 diabetes has been known to be associated with an increased risk for the development of the disease. However, few studies have evaluated the effects of family history of diabetes on residual beta-cell function in type 2 diabetic patients. We investigated associations among family histories, clinical characteristics and plasma C-peptide levels in type 2 diabetic patients. A total of 1,350 patients with type 2 diabetes were recruited. The patients with a family history of type 2 diabetes had younger age at onset of diabetes, longer diabetes duration, higher LDL-cholesterol, and lower fasting C-peptide levels than the patients without family history. When divided according to the tertiles of diabetes duration, patients with a family history of type 2 diabetes had more decreased concentrations of fasting C-peptide as duration of diabetes increased, but patients without a family history did not. Multiple regression models were used to determine the association between fasting plasma C-peptide levels and a family history of type 2 diabetes mellitus. With adjustments for age and sex, glycated hemoglobin (HbA(1c)), fasting plasma glucose, free fatty acids, body mass index and diabetes mellitus (DM) duration, there was a significant association (P<0.01). Our results showed that a family history of diabetes was significantly associated with the progressive decline of fasting plasma C-peptide levels in Korean type 2 diabetes mellitus.