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Background Diabetes is a major global public health challenge, with rapidly rising incidence, particularly in low- and middle-income countries. Physical activity is a well-established protective factor against type 2 diabetes (T2DM); however, the population-level impact of realistic modest increases in physical activity remains unclear.Objectives To estimate the burden of T2DM attributable to physical inactivity in Brazil and project the impact of modest increases in physical activity.Research design and methods We calculated the population attributable fractions (PAFs) and economic costs of diabetes due to physical inactivity in Brazil. We estimated the incidence of T2DM from 2026 to 2050 using data from the National Health Survey (2013 and 2019) and the Global Burden of Disease Study. The relative risk of incident diabetes across the physical activity continuum was extracted from a previous meta-analysis. We modelled scenarios simulating gradual increases in leisure-time physical activity (LTPA) and resistance exercise (RE) and projected economic impacts through 2050.Results From 2026 to 2050, 11.7% (95% uncertainty interval, UI 9.5% to 14.1%) of incident T2DM cases in Brazil (~3.7 million) might be attributable to physical inactivity, with higher PAFs among adults with lower education (PAF: 13.7%; 95% UI 11.1% to 16.4%) and in Mixed Race (12%; 95% UI 9.6% to 14.3%) and Black (11.9%; 95% UI 9.5% to 14.2%) populations. In a nonlinear dose-response association, increasing LTPA by 10, 20 or 30 min/day among inactive individuals could prevent 7.0% (2.20 million), 12.9% (4.05 million) and 16.0% (5.02 million) of incident cases, respectively, by 2050. For RE, the same daily increases could prevent 12.0% (3.80 million), 18.7% (5.87 million) and 22.5% (7.07 million) of cases. These increments could significantly reduce healthcare costs, starting at R$1.9 billion for the 10 min LTPA scenario, with the greatest impact observed from RE.Conclusions Promoting small increases in physical activity could yield substantial health and economic benefits. Equitable public health strategies are essential to address disparities and halt the growing burden of diabetes in Brazil.