Background. Neuropathic complications from diabetes mellitus affect multiple nerve types and may manifest in gait. However, gait compensations are still poorly understood, as narrow analyses and lack of speed controls have contributed to conflicting or equivocal results. Purpose. To evaluate gait mechanics and energetics in diabetic peripheral polyneuropathy. Methods. Instrumented gait analysis was performed on 14 participants with diabetic peripheral polyneuropathy and 14 matched controls, walking at 1.0 m/s. A full-body model with a multisegment foot was used to calculate inverse dynamics and analyze sagittal plane metrics and time series waveforms across stance phase. Results. Alterations included increased hip and knee flexion in early stance followed by a prolonged hip extension moment in midstance. Late stance ankle dorsiflexion and power absorption were increased, and final push-off was delayed and truncated. Conclusion. A neuropathic diabetic gait shares important similarities to a mild crouch gait with weakness/dysfunction in the foot and ankle. This study highlights two main compensation mechanisms that have been overlooked in previous literature. First, increased triceps surae stretch in terminal stance may be used to increase proprioception and/or energy storage, while a prolonged hip extension moment in midstance compensates for a limited push-off. These result in an overall workload shift from distal to proximal joints. Clinical assessment, monitoring, and treatment of neuropathy may benefit by focusing on these specific functional alterations.