Moderate alcohol consumption is associated with reduced cardiovascular disease rates in nondiabetic populations. However, the effects of alcohol in people with diabetes are not well defined. Accordingly, we tested the hypothesis that alcohol would raise plasma high-density lipoprotein (HDL) cholesterol or have other beneficial metabolic effects in persons with type 2 diabetes mellitus. To assess the acute effects of alcohol on plasma glucose and serum insulin, subjects were inpatients for 2 days during which they received, in random order, 240 mL wine or grape juice with their evening meal. To assess the chronic effects of alcohol on fasting plasma lipids, subjects consumed, in random order, 120 to 240 mL wine daily for 30 days and abstained from alcohol for 30 days. Participants were 18 non-insulin-treated volunteers with type 2 diabetes mellitus. Acutely, 240 mL wine containing 24 g alcohol had no effect on plasma glucose or serum insulin. Chronically, wine consumption for 30 days (mean consumption, 18 g alcohol per day) compared with abstinence for 30 days resulted, respectively, in mean +/- SEM fasting plasma cholesterol of 160 +/- 6 and 160 +/- 8 mg/dL (P = .98), HDL cholesterol of 47 +/- 3 and 46 +/- 3 mg/dL (P = .87), low-density lipoprotein cholesterol of 82 +/- 5 and 82 +/- 6 mg/dL (P = .98), triglycerides of 157 +/- 19 and 159 +/- 19 mg/dL (P = .88), glucose of 128 +/- 6 and 128 +/- 7 mg/dL (P = .84), and serum insulin of 14 +/- 2 and 17 +/- 3 microU/mL (P = .03). Moderate consumption of alcohol in the form of wine did not raise plasma HDL cholesterol. However, alcohol did not have any harmful metabolic effect; and chronic consumption lowered fasting serum insulin. People with type 2 diabetes mellitus should not be discouraged from using alcohol in moderation.