The expression of large and small vessel disease in type 2 diabetes differs from that observed in type 1, with a higher prevalence of atherosclerosis and hypertension, maculopathy rather than proliferative retinopathy, and nephropathy of a more complex nature. Such differences are mirrored by differences in vascular pathophysiology with an early impairment of microvascular vasodilatory reserve being a prominent feature. The defect appears to be endothelium dependent and in conjunction with evidence of endothelium activation suggests that the endothelium plays a crucial role in the pathogenesis of vascular disease in type 2 diabetes and may even be an intrinsic feature or common antecedent of the insulin resistance syndrome. Several cellular mechanisms may be proposed linking insulin resistance and endothelial dysfunction including (i) abnormalities of common signal transduction mechanisms, (ii) alterations in cell membrane fluidity altering the expression and/or presentation of a wide range of receptors, or (iii) changes in oxidative stress. It is intuitively unlikely that the alteration of a single signal transduction mechanism could be a common cause, particularly as aspects of endothelial dysfunction implicate different mechanisms. Accordingly, changes in oxidative stress, either stemming from glucose-mediated increased free-radical generation and/or reduction of antioxidant capacity, are strong contender mechanisms. Not only may increased oxidative stress result in the quenching of nitric oxide, neutralizing its many protective functions, but it may also damage DNA, protein structure, and membrane properties. Elucidating the links between oxidative stress, endothelial function, and insulin resistance has important implications for the prevention of diabetic angiopathy and perhaps for the prevention of diabetes itself.