Diabetes mellitus is a well-recognized risk factor for periodontitis. The goal of the present study was to elucidate whether oxidative stress and nuclear factor erythroid 2-related factor 2 (Nrf2) participate in the aggravation of periodontitis by diabetes. For this purpose, we assigned Wistar rats to control, periodontitis, diabetes, and diabetic periodontitis groups. Two weeks after induction of diabetes by streptozotocin, periodontitis was induced by ligation. Two weeks later, periodontal tissues and blood were harvested and analyzed by stereomicroscopy, immunohistochemistry, and real-time polymerase chain reaction. We found that ligation induced more severe bone loss and periodontal cell apoptosis in diabetic rats than in normal rats (p < 0.05). Compared with the control group, periodontitis significantly enhanced local oxidative damage (elevated expression of 3-nitrotyrosine, 4-hydroxy-2-nonenal, and 8-hydroxy-deoxyguanosine), whereas diabetes significantly increased systemic oxidative damage and suppressed antioxidant capacity (increased malondialdehyde expression and decreased superoxide dismutase activity) (p < 0.05). Simultaneous periodontitis and diabetes synergistically aggravated both local and systemic oxidative damage (p < 0.05); this finding was strongly correlated with the more severe periodontal destruction in diabetic periodontitis. Furthermore, gene and protein expression of Nrf2 was significantly downregulated in diabetic periodontitis (p < 0.05). Multiple regression analysis indicated that the reduced Nrf2 expression was strongly correlated with the aggravated periodontal destruction and oxidative damage in diabetic periodontitis. We conclude that enhanced local and systemic oxidative damage and Nrf2 downregulation contribute to the development and progression of diabetic periodontitis.