Diabetes care is a critical issue for federally funded community health center delivery sites that provide care for 11 million medically underserved Americans. In 1998, the Bureau of Primary Health Care began a six-year Health Disparities Collaborative, focusing on diabetes care during the first year. This study evaluates the effectiveness of the initiative after the first year. Nineteen centers in the Midwest participated in the collaborative. Centers adopted the rapid change process of Plan, Do, Study, Act (PDSA) from the continuous quality improvement field; a Chronic Care Model that emphasized patient self-management, delivery system redesign, decision support, clinical information systems, leadership, health system organization, and community outreach; and collaborative learning sessions. Data was collected one year before and after the trial from 969 charts of random adults for American Diabetes Association standards, surveys of 79 diabetes quality improvement team members, and qualitative interviews. Results indicated that the performance of several key processes of care increased, including rates of HbA1c measurement (80 to 90 percent), eye examination referral (36 to 47 percent), foot examination (40 to 64 percent) and lipid assessment (55 to 66 percent). Most survey respondents asserted that the Diabetes Collaborative was successful and worth the effort (over 90 percent). Major challenges the initiative faced included demand for additional time and resources, initial difficulty developing computerized patient registries, team and staff turnover, and occasional need for more senior management support. The study concludes that in the time span of one year, the Health Disparities Collaborative improved diabetes care in health centers. Future research is needed to address the sustainability of quality improvement efforts.