Non-alcoholic fatty liver disease (NAFLD) is highly prevalent in type 2 diabetes mellitus (T2DM), likely reflecting the frequent occurrence of obesity and insulin resistance in T2DM. NAFLD also can occur in type 1 DM (T1DM), but must be distinguished from the more common glycogen hepatopathy as a cause of hepatomegaly and liver function abnormalities in T1DM. Weight reduction achieved by diet and exercise is effective in preventing and treating NAFLD in obese diabetic subjects. Bariatric surgery also has been shown to reverse NAFLD in T2DM, and recently approved weight loss medications should be evaluated for their impact on the development and progression of NAFLD. There is limited evidence suggesting that specific drugs used for blood glucose control in T2DM [thiazolidinediones (TZDs), glucagon-like peptide-1 (GLP-1) analogs, and dipeptidyl peptidase-4 (DPP-4) inhibitors] and also statins may have a role in preventing or treating NAFLD in patients with diabetes.