DNA methylation studies of incident type 2 diabetes in US populations are limited, and to our knowledge none included individuals of African descent living in the US. We performed an epigenome-wide association analysis of blood-based methylation levels at CpG sites with incident type 2 diabetes using Cox regression in 2,091 Black and 1,029 White individuals from the Atherosclerosis Risk in Communities study. At an epigenome-wide significance threshold of 10-7, we detected 7 novel diabetes-associated CpG sites in C1orf151 (cg05380846: HR= 0.89, p = 8.4 × 10-12), ZNF2 (cg01585592: HR= 0.88, p = 1.6 × 10-9), JPH3 (cg16696007: HR= 0.87, p = 7.8 × 10-9), GPX6 (cg02793507: HR= 0.85, p = 2.7 × 10-8 and cg00647063: HR= 1.20, p = 2.5 × 10-8), chr17q25 (cg16865890: HR= 0.8, p = 6.9 × 10-8), and chr11p15 (cg13738793: HR= 1.11, p = 7.7 × 10-8). The CpG sites at C1orf151, ZNF2, JPH3 and GPX6, were identified in Black adults, chr17q25 was identified in White adults, and chr11p15 was identified upon meta-analyzing the two groups. The CpG sites at JPH3 and GPX6 were likely associated with incident type 2 diabetes independent of BMI. All the CpG sites, except at JPH3, were likely consequences of elevated glucose at baseline. We additionally replicated known type 2 diabetes-associated CpG sites including cg19693031 at TXNIP, cg00574958 at CPT1A, cg16567056 at PLBC2, cg11024682 at SREBF1, cg08857797 at VPS25, and cg06500161 at ABCG1, 3 of which were replicated in Black adults at the epigenome-wide threshold. We observed modest increase in type 2 diabetes variance explained upon addition of the significantly associated CpG sites to a Cox model that included traditional type 2 diabetes risk factors and fasting glucose (increase from 26.2% to 30.5% in Black adults; increase from 36.9% to 39.4% in White adults). We examined if groups of proximal CpG sites were associated with incident type 2 diabetes using a gene-region specific and a gene-region agnostic differentially methylated region (DMR) analysis. Our DMR analyses revealed several clusters of significant CpG sites, including a DMR consisting of a previously discovered CpG site at ADCY7 and promoter regions of TP63 which were differentially methylated across all race groups. This study illustrates improved discovery of CpG sites/regions by leveraging both individual CpG site and DMR analyses in an unexplored population. Our findings include genes linked to diabetes in experimental studies (e.g., GPX6, JPH3, and TP63), and future gene-specific methylation studies could elucidate the link between genes, environment, and methylation in the pathogenesis of type 2 diabetes.