Australian researchers will conduct a 'world-first' study to advance understanding of the progression of diabetic complications in people with type 2 diabetes.

Understanding why people with type 2 diabetes are at greater risk of dementia and heart failure will be the focus of a large Australian study.

Nearly 300 Australians develop diabetes every day and the chronic disease is the leading cause of kidney failure, lower limb amputations and preventable blindness.

But worrying new complications of diabetes are emerging and medical professionals don't know why, says Victorian diabetes expert Professor Jonathan Shaw.

"We're seeing cognitive impairment, people progressing towards dementia, we're seeing physical disability and with an ageing population these are two of the things that people fear the most; the loss of independence," Prof Shaw said.

"Both of those are related to diabetes but how that works, how many people get it, who's going to get it are all things we don't know enough about."

Australians with type 2 diabetes are also now more at risk of developing heart failure as opposed to heart attacks, said Professor Shaw.

"If we go back 20 years or so hospitals were full of people, particularly with diabetes, having heart attacks and strokes, we are now better at preventing that and at treating it.

"But what we are seeing is people short of breath having difficulty moving about because of heart failure, in fact heart failure is worse in terms of its outlook than many cancers," Prof Shaw told AAP.

To investigate why this is, researchers at La Trobe University and Baker Heart and Diabetes Institute will recruit 1500 adults across Victoria to advance understanding of the progression of diabetic complications in people with type 2 diabetes.

Participants will be tested on a range of things including cognitive, psychological, behavioural and physical functions. Blood tests using cutting-edge technology and physical examinations will also be conducted.

They will then be followed for five to 10 years, during which time adherence to medication will be monitored.

"Having diabetes means the individual has to put a lot of effort into managing themselves and people obviously find that a significant challenge and some people do it better than others, some of those aspects are likely to be very important in the development of complications but you can't really measure that in a test tube," Prof Shaw said.

"We have other studies that indicate that lots of people, probably the majority don't take all of the medications they're prescribed," he noted.

La Trobe public health expert Professor Rachel Huxley says it's critical to be able to predict the risk of complications in people with type 2 diabetes.

"Predicting risk will help clinicians to improve patients' quality of life and will inform future prevention and treatment strategies," said Prof Huxley.

People with type 2 diabetes who are interested in taking part in the study can visit: https://baker.edu.au/research/clinical-trials/diabetes-complications.