Objective Third cranial nerve palsy is known to be a diabetic neuropathic complication. We investigated the prevalence and clinical characteristics of diabetic patients with palpebral ptosis (PP) in Korea. Methods This cross-sectional study is based on data from the fourth and fifth Korea National Health and Nutritional Examination Surveys (KNHNES), which were conducted in 2009 and 2010 among members of the Korean population. Participants included 5811 males and 7650 females 20 years of age or older, who were selected from all of the 16 administrative districts of South Korea. PP was defined as the marginal reflex distance 1 (MRD1) of < 4 mm. Measurements of fasting plasma glucose, HbA1c, and serum insulin levels were performed. Homeostatic model assessment of insulin resistance (HOMA-IR) was calculated in participants without diabetes. Results The prevalence of subjects with PP was 20.8% and 9.4 % among diabetic (n = 1379) and non-diabetic participants (n = 12082), respectively. The diabetic patients with PP had longer duration of diabetes (7.49 ± 0.51 vs. 6.1.9 ± 0.51 0.23 years, P = 0.012), higher serum creatinine level (0.91 ± 0.51 0.02 vs. 0.87 ± 0.51 0.01 mg/dL, P = 0.009), and were older (67.0 ± 0.51 0.6 vs. 60.5 ± 0.51 0.4 years, P < 0.001) in comparison with diabetic subjects without PP. HOMA-IR was higher among participants with PP than among those without in non-diabetic subjects (2.39 vs. 2.27, P = 0.003). Conclusion In conclusion, insulin resistance was associated with PP among non-diabetic subjects. Diabetic subjects with longer duration of diabetes, old age, and higher serum creatinine level may be at risk for PP. Those patients may deserve attention from clinicians to ensure better management of neuropathy.