Insulin resistance and progressive beta-cell failure are fundamental defects in type 2 diabetes. Treatments that improve insulin sensitivity and beta-cell function can improve these defects and improve glycemic control. The thiazolidinediones (TZDs) improve insulin sensitivity, fasting and postprandial plasma glucose levels, and glycosylated hemoglobin (HbA1c) levels. These agents can be used as monotherapy, and they have been successfully combined with other antidiabetic therapies. The TZDs have also been associated with improvements in various cardiovascular risk factors, including hypertension, the dyslipidemic profile often observed in patients with diabetes or insulin resistance, aspects of endothelial dysfunction, abnormal hemostasis, and levels of several inflammatory markers. Studies are currently under way to evaluate the effects of TZDs on cardiovascular event rates. Accumulating evidence suggests that TZDs may enhance or preserve beta-cell function and thus may have a more durable therapeutic effect than some of the other oral antidiabetic agents. Using TZDs as monotherapy or as a component of combination therapy will contribute to improved glycemic control and should reduce the risk of diabetic complications. A number of studies have shown that a strategy of aggressive use of pharmacologic agents to achieve glycemic control is associated with cost benefits.