Hi satishchandra,

From bol

http://msdn2.microsoft.com/en-us/library/ms186552.aspx

SQL Server 2005 database diagrams and SQL Server 2000 database diagrams are created and rendered differently.

Because of these differences, SQL Server Management Studio cannot work with SQL Server 2000 diagrams. Use SQL Server 2000 Enterprise Manager.

When a database containing diagrams is upgraded to SQL Server 2005, the diagrams will be upgraded the first time that the diagrams folder is opened.

You must be a member of the db_owner database role to upgrade database diagrams.

Regards,

Ahmed