Due diligence usually refers to the tasks or inquiries that someone needs to complete before signing a contract or making a large purchase like a house.
Diligence means "the attention or care required," and due is used in this phrase as an adjective meaning "appropriate, expected, or necessary." So when you perform due diligence, you give some project the kind of care and attention that it needs.
Imagine you're buying a used car. The current owner claims, "It runs perfectly!" But if you don't take it for a test drive or bring it to a mechanic for a professional opinion, you haven't done your due diligence as a buyer — and you're definitely going to be angry at yourself when the engine dies halfway through your cross-country drive.
Due diligence originated in a legal context, but as you can see in these examples, the phrase is relevant in any situation where careful attention backed up by research would prove useful or essential:
Prosecutors say the judge did "due diligence" and considered all pertinent information. (Washington Times)
"Finding the appropriate balance between our nation's security and an open, collaborative scientific environment requires focus and due diligence." (Science Magazine)
Do diligence is an easy error to understand, especially since you'll often see the correct phrase used in the construction "do your due diligence." The fact that do and due are homophones also contributes to mistakes like this one:
There's a lot of "wanna-preneuers" out there that are getting funded by too many angels who have done very little "do diligence." (Forbes)
But you don't DO diligence; in this phrase, the diligence is due, or required, prior to making a major, legally binding commitment. Now that you've done your due diligence by reading this article, you';ll always know how to use the expression due diligence correctly!