Diabetes mellitus and advanced liver disease are associated with each other more frequently than expected by chance, and such an association carries a significant risk of morbidity and mortality. A metabolic pathway leading to advanced liver disease via fatty liver and steatohepatitis has been demonstrated, further supporting the possibility that cirrhosis may be a late complication of diabetes. In addition, an interaction between hepatitis C virus (HCV) and insulin resistance increases the overall prevalence of associated diseases, through largely unidentified mechanisms. Extensive prospective monitoring of non-alcoholic fatty liver disease cases, analysis of insulin signaling in HCV-infected patients using molecular biology techniques, and intervention studies, will help to clarify the mechanisms of action of the possible clinical strategies, the predictive value of biochemical, histological, and clinical markers, and the effectiveness of treatments available.