Brain-derived neurotrophic factor (BDNF) plays a regulatory role in neuronal differentiation and synaptic plasticity and has been linked to glucose regulation and cognition. Associations among plasma BDNF, cognition, and insulin function were explored. Forty-one participants with impaired insulin function (IIF), ranging from insulin resistance to type 2 diabetes mellitus (T2DM), were matched with 41 healthy controls on gender, age, education, and IQ. Participants received complete medical, neurological, psychiatric, and neuropsychological evaluations. IIF individuals had significantly lower plasma BDNF levels than controls, particularly females, and higher BDNF levels were associated with poorer explicit memory in IIF females, suggesting that higher levels within this group may reflect the body's efforts to respond to damage. After accounting for age, education, and HbA1c, BDNF significantly predicted 13.1-23.5% of the variance in explicit memory in IIF women. These findings suggest that BDNF elevations within diseased groups may not always be a marker of health. (Contains 5 tables.)