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The primary goal of this retrospective cohort study was to determine the incidence of failure to heal after lower extremity amputation for the treatment of diabetic neuropathic foot ulcer, and the secondary goal was to identify risk factors associated with the outcome. We evaluated 1775 patients who underwent amputation for the treatment of 5314 neuropathic foot ulcers, and who were treated in a network of wound care centers. We calculated the incidence of failure to heal after the initial amputation, and used generalized estimation equations and generalized linear latent and mixed model regression to evaluate the association of failure to heal by the 20th week of care. The unadjusted incidence of failure to heal was 34.01%, and male sex, number of wounds, wound grade, and adjunct therapy were all significantly associated with failure to heal. With the exception of wound grade, the associations were not significantly affected by the treating wound care center, and a sensitivity analysis showed the results to be resistant to the theoretical influence of an unmeasured potential confounder. These findings should be useful to clinicians treating diabetic neuropathic foot ulcers, and should aid surgeons in the determination of the most appropriate level for lower extremity amputation.