Peripheral arterial disease (PAD) is a macrovascular diabetic complication, characterized by atherosclerotic plaque formation due to hyperglycemia and dyslipidemia. The molecular mechanisms involved in PAD-T2DM pathogenesis will help in understanding and early prognosis; therefore, we aim to evaluate FABP4 levels and Nrf2 single-nucleotide polymorphisms (SNPs) among PAD-T2DM patients. In a case-control study, 123 samples (healthy control HC, T2DM, and PAD-T2DM; n = 41 each) were collected from the diabetic foot clinic at Mayo Hospital, Lahore. Baseline and biochemical data were collected. PAD diagnosis was established by measuring the ankle-brachial index with color Doppler ultrasound. Serum FABP4 levels were measured using an ELISA. Nrf2 SNP rs35652124 analysis was performed by restriction fragment length polymorphism. PAD-T2DM prevalence was higher among male subjects (61.1%). Fasting plasma glucose levels (p = 0.02), total cholesterol (p < 0.0001), and LDL-cholesterol (p = 0.01) were significantly higher in PAD-T2DM as compared to T2DM. SNP association analysis showed that homozygous genotype TT (OR: 3.85, 95% (CI): 1.22-12.11, p = 0.02) and T-allele (OR: 1.31, 95% (CI): 1.31-4.67, p = 0.005) were significantly associated with PAD-T2DM. FABP4 levels were higher in the PAD-T2DM group as compared to T2DM (p < 0.0001) and were significantly associated with Nrf2 SNP genotype TT (p < 0.001) and CT (p = 0.01) in PAD-T2DM. Our results showed, for the first time, that the Nrf2 SNP is significantly associated with PAD-T2DM and FABP4 levels compared to T2DM.