Previous studies have reported inconsistent results of the associations of alanine transaminase (ALT), aspartate transaminase (AST), gamma-glutamyltransferase (GGT) and alkaline phosphatase (ALP) with incident type 2 diabetes (diabetes hereafter). We aimed to resolve the controversy by taking nonalcoholic fatty liver disease (NAFLD) into account. The study population comprised 132,377 non-diabetic individuals (64,875 men and 67,502 women) aged 35-79 who had two or more health examinations during 1996-2014. A total of 6,555 incident diabetes (3,734 men and 2,821 women) were identified, on average, over 5.8 years of follow-up. Cox regression was used to calculate the hazard ratio (HR) for incident diabetes, adjusting for classical confounders. The risk of incident diabetes was significantly associated with NAFLD [HR = 2.08 (men) and 2.65 (women)]. Elevated ALT, AST, GGT and ALP were also significantly associated with the increased risk of diabetes, with HRs of 1.27, 1.23, 1.58 and 1.37, respectively, in men, and 1.56, 1.18, 1.48 and 1.44, respectively in women. Our results suggest that NAFLD, ALT, AST, GGT and ALP are independent predictors for incident diabetes in both men and women.