High mobility Al0.28Ga0.72N/GaN two-dimensional electron gas (2DEG) is achieved on ( 111) oriented single crystal diamond substrate. The surface morphology of the epilayer is free of cracks thanks to the use of an AlN interlayer for strain relaxation. The rms roughness of the sample surface deduced from atomic force microscopy is 0.6 nm for a 2 x 2 mu m(2) scan area, which indicates an excellent surface morphology. Hall effect measurements reveal a 2DEG with room temperature mobility and sheet carrier density of 750 cm(2) V-1 s(-1) and 1.4 x 10(13) cm(-2), respectively. These results compare fairly well with AlGaN/GaN 2DEG characteristics obtained on other substrates like silicon and demonstrate that high power electronics can be developed on diamond substrates with high power dissipation capabilities. (C) 2010 The Japan Society of Applied Physics