Background: Type 2 diabetes mellitus (T2DM) is often associated with microvascular complications that contribute to morbidity mortality. Obestatin, an anorexigenic gut peptide derived from ghrelin gene, has been linked among metabolic regulation, insulin resistance, vascular health. This research aimed to evaluate serum obestatin levels in T2DM patients with and without microvascular complications. Methods: This cross-sectional research was performed on 60 patients with T2DM, divided equally into 2 groups with and without microvascular complications. All participants underwent detailed clinical evaluation, anthropometric assessments, fundus examination, laboratory investigations including fasting serum insulin, urinary albumin-to-creatinine ratio (UACR), as well as estimated glomerular filtration rate (eGFR) in addition to measurement of serum obestatin levels by ELISA. Results: From the 60 T2DM patients, 30 (50%) had microvascular complications (DPN 21; retinopathy 18; DKD 21). Compared with uncomplicated cases, they had longer duration (16.5 vs 8.3 years), higher BMI/waist (39.1 kg/m²; 99.5 cm vs 35.2; 90.3), higher BP, impaired renal function (eGFR 58.2 vs 84.4 mL/min), more atherogenic lipids, and higher FPG/PPPG (all p < 0.05). Serum obestatin was lower in T2DM and lowest with complications; it declined across albuminuria (3.67 → 2.70 → 1.17 pg/mL; p < 0.001). Obestatin correlated negatively with adiposity, lipids, glycemia, creatinine/urea, and duration, positively with HDL-C/eGFR (all p < 0.001), strongly with HOMA-IR (r = 0.900). Conclusions: Reduced serum obestatin in T2DM particularly in patients with albuminuric DKD suggests a potential protective diagnostic role. Obestatin could be an early biomarker possible therapeutic target for preventing or delaying microvascular complications in T2DM