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Type 2 diabetes mellitus (T2DM) is increasingly recognised as a driver of cerebrovascular dysfunction and cognitive decline, yet the molecular mechanisms underlying this association remain incompletely understood. Here, we review and support a key mechanistic role for nitric oxide (•NO), a pleiotropic diffusible messenger that integrates vascular, neuronal, and metabolic functions within the neurovascular unit (NVU). Under physiological conditions, •NO integrates vascular and metabolic responses by coupling blood supply to neuronal activity and fine-tuning cellular energy metabolism. In T2DM, chronic hyperglycemia and insulin resistance converge to reduce •NO bioavailability through multiple mechanisms: mitochondrial and NADPH oxidase-derived superoxide production, endothelial nitric oxide synthases (eNOS) uncoupling via BH4 oxidation, and impaired PI3K-Akt-dependent eNOS activation. The resulting redox imbalance shifts the cerebrovascular environment towards oxidant-mediated damage, compromising the functional and structural integrity of the NVU. This translates into impaired cerebral blood flow regulation and maladaptive remodelling of the cerebrovascular network, ultimately disrupting neurovascular coupling (NVC) and reducing regional cerebral perfusion. Together, impaired perfusion and disrupted NVC result in a sustained mismatch between energy supply and neuronal demand, particularly in metabolically vulnerable regions such as the hippocampus, ultimately leading to progressive cognitive impairment. In sum, the present review integrates current mechanistic evidence positioning •NO dysregulation as a central driver of neurovascular and metabolic dysfunction in T2DM, linking impaired cerebral perfusion, disrupted NVC, and structural vascular remodelling to cognitive decline.