Background: Diabetes mellitus (DM) is a metabolic disorder characterized by hyperglycemia resulting from defective insulin action, secretion or both. Liver disorders are known to be a risk factor for diabetes, and diabetic patients are prone to both liver and kidney disorders. However, the association between these diseases has not yet been thoroughly studied in Ethiopia. Materials and Methods: An institution based comparative cross-sectional study was conducted among 142 individuals at Jimma Medical Center. The data were collected using consecutive sampling techniques. The data were entered into EpiData v: 4.6 and was exported to statical package for social science (SPSS) v: 26 for analysis and statistically tested at a confidence level of 95%. The mean difference was tested independently and the correlation between the explanatory and outcome variables was examined using Pearson’s correlation analysis. Bivariate and multivariate logistic regressions were used to test the predictors of the outcome variables in the study participants. Results: In total 142 patients diagnosed with type 2 diabetes mellitus were recruited for this study. Mean values of alkaline phosphatase was higher and statically significant (115.27±22.41 vs. 97.42±29.57 P<0.001). However, mean value of, Total bilirubin (0.86 ± 0.47 vs. 1.03 ± 0.48, P =0.028,) and direct bilirubin (0 .16 ± 0.083 vs. 0.21 ±0.09 P= 0.003), were significantly lower in diabetic kidney disease patients. Waist circumference has positive correlated with direct bilirubin level (r= 0.243, p =0.004) and the duration of diabetic follow up was   positively correlated alanine aminotransferase concentration (r=0.168 P=0.045). Conclusion: Mean of ALP was significantly higher in patients type 2 diabetes with chronic kidney disease than in those without chronic kidney disease. The mean value of direct and total bilirubin value were, lower in type two diabetic patients with chronic kidney disease.