The liver plays a unique role in controlling carbohydrate metabolism by maintaining glucose concentrations in a normal range over both short and long periods of times. In type 2 diabetes, alterations in hepatic glucose metabolism are observed, i.e. increased post-absorptive glucose production and impaired suppression of glucose production together with diminished glucose uptake following carbohydrate ingestion. The simultaneous overproduction of glucose and fatty acids in liver further stimulates the secretion of insulin by the pancreatic B cells, and elicits further peripheral insulin resistance thereby establishing a vicious circle. The present review will focus on some of the genetically-altered mouse models that have helped identify enzymes or transcription factors that are essential for maintaining either glucose or lipid homeostasis in liver. Among these mouse models, we will discuss transgenic mice overexpressing key gluconeogenic enzymes (PEPCK, G6Pase) or transcription factors (Foxo1, Pgc1-alpha) that control de novo glucose synthesis. In addition, since the possibility of controlling hepatic glucose utilization as a treatment of type 2 diabetes has been explored we will review some of the strategies proved to be valuable for improving the hyperglycemic phenotype.