In recent years, the prevalence of type 2 diabetes has increased alarmingly worldwide, giving diabetes the dimension of an epidemic. Striking parallel increases in the prevalence of obesity reflect the importance of body fatness as a contributing factor to diabetes incidence. Moreover, it has been estimated that up to 75% of the risk of type 2 diabetes is attributable to obesity. Recent clinical trials and observational epidemiologic studies demonstrate the efficacy of lifestyle changes, including decreased energy intake, decreased fat intake, and weight loss, as well as regular participation in physical activity, in improving insulin sensitivity (SI) and reducing the risk of diabetes. This review evaluates evidence of the effect of diet on insulin resistance, insulin secretion, and glucose tolerance, and reflects on directions for future work toward primary prevention of type 2 diabetes.