We evaluated long-term effects of testosterone undecanoate on glycemic control, metabolic syndrome, vascular function and morphology in obese men with functional hypogonadism (FH) and type 2 diabetes (T2D) in a 2-year prospective clinical trial. A total of 55 participants were enrolled in this study; group P (n = 27) received placebo during first and testosterone therapy (TTh) during second year, group T (n = 28) received TTh both years. We pooled results after 1 year of TTh to obtain more statistical power. Results for group T after 2 years of TTh are also presented. We evaluated wide assortment of biochemical (fasting plasma glucose—FPG, glycated hemoglobin—HbA1c and lipid profile), hormonal, vascular (flow-mediated dilatation—FMD and intima-media thickness—IMT), anthropometrical and derived parameters (BMI, HOMA-IR, non-HDL cholesterol, bioavailable and calculated free testosterone). Quality of life was assessed using Aging Males' Symptoms (AMS) questionnaire. FPG, HbA1c, HOMA-IR and IMT decreased, FMD increased, lipid profile and AMS sexual sub-score improved, and testosterone levels fully normalized after 2 years of TTh. Two-year of TTh resulted in normalized serum testosterone levels, improved glycemia, endothelial function, lipids and insulin sensitivity, and quelled the symptoms of hypogonadism, potentially reducing cardiovascular risk in obese men with FH and T2D. [ABSTRACT FROM AUTHOR]