The vitamin D endocrine system in now recognized as subserving a wide range of fundamental biological functions in cell differentiation, inhibition of cell growth as well as immunomodulation. Both forms of immunity, namely adaptive and innate, are regulated by 1,25(OH)2D3. The immune-modulatory properties of vitamin D suggest that it could play a potential therapeutic role in prevention of type 1 diabetes mellitus (T1DM). It is postulated that large doses of vitamin D supplementation may influence the pattern of immune regulation and subsequent progression to T1DM in a genetically susceptible individual. More studies are required to substantiate the relation between T1DM and vitamin D/vitamin D analogues in the pattern of immune regulations in susceptible individuals. In type 2 diabetes mellitus (T2DM), vitamin D may influence both insulin secretion and sensitivity. An inverse relationship between T2DM and vitamin D is postulated from cross-sectional and prospective studies, though conclusive proof is as yet lacking. Available studies differ in their design and in the recommended daily allowances (RDA) of vitamin D in non-skeletal diseases and β-cell function. Large, well designed, controlled, randomized interventional studies on the potential role of vitamin D and calcium in prevention and management of T2DM are required to clarify the relationship between vitamin D and glucose homeostasis in T2DM.