The secosteroid vitamin D is best known for its role in calcium regulation and bone metabolism. Recently, however, an emerging body of evidence has suggested that vitamin D may have previously-unrecognized effects on a variety of physiologic processes, including those relating to glucose homeostasis. Indeed, vitamin D insufficiency has been linked with type 2 diabetes (T2DM). In this review, the potential association between vitamin D and T2DM will be evaluated from both a pathophysiologic and clinical perspective. We consider the biologic evidence in support of a mechanistic contribution of vitamin D insufficiency to insulin resistance and beta-cell dysfunction, the two main pathophysiologic defects underlying T2DM. We also evaluate the clinical data linking vitamin D with these metabolic defects and dysglycemia. Finally, interventional studies addressing the effect of vitamin D supplementation on glucose homeostasis are considered. At present, this evolving literature is marked by many conflicting results and methodologic limitations, such that definitive conclusion on the role of vitamin D in T2DM remains elusive. Nevertheless, in light of the widespread prevalence of both vitamin D insufficiency and T2DM, this potential relationship could hold enormous public health implications and hence demands further study to address its unresolved questions.