On November 6, 2012, Diaz was re-elected with 37 percent of the ballots cast in Perth Amboy, receiving 4,404 votes, surpassing top challenger Billy Delgado and second-tier candidates Frank Salado, Miguel Morales, Robert McCoy, and Sharon Hubberman, who had a combined 7,147-vote total.

[5] Diaz cooperated in an investigation being conducted by federal and state law enforcement agencies relating to activities connected to former Mayor Vas's administration.

[8] Six challengers filed petitions to run against Diaz by the September 4 deadline, but 2004 mayoral candidate Billy Delgado appears to be her top rival.

[9] While running for re-election, Diaz disclosed the contents of a private e-mail from her former campaign consultant in which the political operative indelicately challenged her "lack of gravitas and intelligence".

That message was exploited by the campaign, in a press conference that morphed the confidential suggestion that she not seek a second term into an "unacceptable level of misogynistic rhetoric" and daily newspapers purveyed the distortion.

Dianne Roman served as city administrator under former Mayor Joe Vas but she is also being supported for re-election to the school board by Diaz, who kept her on the municipal payroll.

She agreed to support South Amboy Mayor John O'Leary to replace Vas in the Assembly, but he withdrew from the race after allegations of corruption were publicized and the state Attorney General initiated an investigation of his business affairs.

[22] In collaboration with the Perth Amboy Business Improvement District (BID), Diaz launched a June 2011 effort to stop littering.

[24] As a member of the task force, Diaz endorsed Republican efforts to abolish the state's affordable housing program, which was criticized by advocates for the poor.

[29][30] In August 2011, representatives from the Kushner Companies made a presentation to the Perth Amboy Redevelopment Agency proposing a scaled-back design concept for the Landings at Harborside, a residential development set to be built along the city's waterfront, and allowing rental housing instead of owner-occupied units as originally planned.

Diaz endorsed the plan the following month, saying "This is an opportunity to have a redesign Perth Amboy is proud of, that reflects the city's historical significance.