We conducted a population-based cohort study using administrative databases to quantify the association between oral and inhaled corticosteroid use and onset of diabetes mellitus in the elderly. Proton pump inhibitor (PPI) users were used as a control group. Relative to PPI users (N = 53,845), oral corticosteroid users (N = 31,864) were more likely to develop diabetes (adjusted rate ratio [aRR], 2.31; 95% confidence interval [95% CI], 2.11 to 2.54); however, inhaled corticosteroid users (N = 38,441) were not (aRR, 1.03; 95% CI, 0.93 to 1.14). The estimated number needed to harm for continuous use of oral corticosteroids relative to PPIs over 1, 2, and 3 years of use were 41, 23, and 16, respectively.