Some studies suggest a positive association between arsenic exposure and risk of diabetes. However, the findings are inconsistent and inconclusive, particularly at a low to moderate arsenic exposure level, and longitudinal data are lacking. We examined toenail arsenic at low to moderate level in young adulthood in relation to incidence of diabetes later in life. This study included 4102 black and white participants aged 20-32 at baseline (1987-88) who completed up to 7 follow-up exams through 2015-16. Toenail arsenic was measured by collision-cell inductively-coupled-plasma mass-spectrometry. Incident diabetes was defined as fasting glucose ≥ 126 mg/dL, non-fasting glucose ≥ 200 mg/dL, 2-h postchallenge glucose ≥ 200 mg/dL, hemoglobin A1c ≥ 6.5%, or use of glucose-lowering medications. Cox proportional hazards model and generalized estimating equations (GEEs) were used to determine the associations of quintiles of toenail arsenic with incident diabetes and other metabolic parameters. The median (inter-quartile range) toenail arsenic level was 0.097 (0.065-0.150) ppm in this study. During the follow-up period, 599 incident cases of diabetes were identified. After adjustment for potential confounders, the hazards ratio (95% confidence interval) was 0.96 (0.73, 1.27) (P for linear trend= 0.85) comparing the highest to the lowest quintile of toenail arsenic levels. No significant association was observed between toenail arsenic and levels of fasting glucose, insulin, homeostatic model assessment of insulin resistance, homeostatic model assessment of beta cell function, or C-reactive protein. The null associations persisted across subgroups of age, sex, race, and body mass index. Findings from this longitudinal study do not support the hypothesis that low to moderate toenail arsenic levels in young adulthood is associated with diabetes risk later in life.