In subjects with type 2 diabetes, both defects of insulin secretion and insulin resistance contribute to the development of hyperglycaemia. The major goals of treatment are to optimise blood glucose control, and normalise the associated lipid disturbances and elevated blood pressure. Pharmacologic treatment is often necessary. This paper discusses new forms of oral treatment for subjects with type 2 diabetes. These include a new sulphonylurea compound glimepiride (Amaryl), which binds to a different protein of the putative sulphonylurea receptor than glibenclamide, and seems to have a lower risk of hypoglycaemia. A new class of drugs with insulin secretory capacity, of which repaglinide (NovoNorm) is the leading compound, is now in phase III clinical trials. Alpha-glucosidase inhibitors reversibly inhibit alpha-glucosidase enzymes in the small intestine, which delays cleavage of oligo- and disaccharides to monosaccharides. This leads to a delayed and reduced blood glucose rise after a meal. Two compounds are in development or have been marketed, ie, miglitol and acarbose (Glucobay). Another new class of drugs is the thiazolidine-diones, which seem to work by enhancing insulin action. The 'insulin sensitising' effects of the leading compounds, troglitazone and BRL 49653C, do not involve any effect on insulin secretion. These drugs also seem to beneficially influence serum cholesterol and triglyceride levels. Oral antihyperglycaemic agents can be used only during a limited period of time in most patients, after which the diabetic state 'worsens' and insulin therapy has to be started. In this light, two new forms of treatment which require subcutaneous injections are also discussed: the synthetic human amylin analogue AC137 (pramlintide) and glucagon-like peptide-1 (7-36)-amide, a strong glucose-dependent stimulator of insulin secretion. It remains to be seen whether these compounds can be developed further for clinical use in patients with diabetes.