This study aimed to assess the efficacy of a new povidone-iodine (PVP-I) foam dressing (Betafoam) vs foam dressing (Medifoam) for the management of diabetic foot ulcers. This study was conducted between March 2016 and September 2017 at 10 sites in Korea. A total of 71 patients (aged ≥19 years) with type 1/2 diabetes and early-phase diabetic foot ulcers (Wagener classification grade 1/2) were randomised to treatment with PVP-I foam dressing or foam dressing for 8 weeks. Wound healing, wound infection, patient satisfaction, and adverse events (AEs) were assessed. The PVP-I foam and foam dressing groups were comparable in the proportion of patients with complete wound healing within 8 weeks (44.4% vs 42.3%, P = .9191), mean (±SD) number of days to complete healing (31.00 ± 15.07 vs 33.27 ± 12.60 days; P = .6541), and infection rates (11.1% vs 11.4%; P = 1.0000). Median satisfaction score (scored from 0 to 10) at the final visit was also comparable between groups (10 vs 9, P = .2889). There was no significant difference in AE incidence (27.8% vs 17.1%, P = .2836), and none of the reported AEs had a causal relationship with the dressings. The results of this study suggest that PVP-I foam dressing has wound-healing efficacy comparable with foam dressing, with no notable safety concerns. This study was funded by Mundipharma Korea Ltd and registered at ClinicalTrials.gov (identifier NCT02732886).