Surgical decompression of peripheral nerves in patients with diabetes was reported to restore sensation and improve function. In this study, a retrospective review of 12 diabetic and 20 nondiabetic patients with lower-extremity peripheral neuropathy who underwent surgical decompression was performed. Clinical evaluation by Tinel test, muscle power examination, and 2-point discrimination were performed preoperatively, at 6 months, and between 9 and 15 months postdecompression. Clinical outcomes were classified into excellent, good, or fair based on improvement in symptoms and return of function. Thirty-two patients underwent 36 surgeries, in which 99 lower-extremity nerves were decompressed. There was a statistically significant improvement in muscle function (P < 0.001) and 2-point discrimination for the small toe (P = 0.008) and big toe (P = 0.038). At a mean of 7.7 months, 90% of patients showed significant improvement in pain and function. It is concluded that surgical decompression was associated with significant improvement in clinical outcome in patients with diabetic and idiopathic neuropathy with evidence of superimposed compression.