Glipizide is one of the most commonly prescribed drugs for treatment of type 2 diabetes. Oral therapy with glipizide comprises problems of bioavailability fluctuations and may be associated with severe hypoglycaemia and gastric disturbances. As a potential for convenient, safe and effective antidiabetic therapy, the rationale of this study was to develop a transdermal delivery system for glipizide. For this purpose, inclusion complexes of the drug in β-cyclodextrin (β- CyD), dimethyl-β-cyclodextrin (DM-β-CyD), hydroxypropyl-β-cyclodextrin (HP-β-CyD), and hydroxypropyl-γ- cyclodextrin (HP- γ-CyD) were prepared. Several percutaneous formulations of the drug and the prepared complexes in different bases (o/w emulsion, polyethylene glycol, carboxymethyl cellulose and Carbopol) were developed. Release studies revealed an improved release of the drug from formulations containing glipizide-CyD complexes. Ex vivo permeation studies through full thickness rat abdominal skin were conducted, whereby the effect of several conventional penetration enhancers (propylene glycol [PG], oleic acid, urea, dimethyl sulfoxide, menthol, limonene and cineole) was monitored. Highest flux was obtained from ointments prepared with Carbopol gel base containing a combination of PG and oleic acid as well as ointments prepared in the same base utilizing glipizide DM-_-CyD complex and urea. In vivo studies on diabetic male Wistar rats revealed a marked therapeutic efficacy sustained for about 48 hours. In this respect, two formulations showed best biological performance. In the first formulation, the drug was incorporated in Carbopol gel base in the presence of 20% PG together with 15% oleic acid. The second was prepared by incorporating glipizide DM-_- CyD complex in Carbopol gel base in presence of 15% urea. The glucose tolerance test showed suppression of hyperglycaemia induced in glucose-loaded rats. The above-mentioned results might shed a strong beam of light on the feasibility of using glipizide in a transdermal delivery system for treatment of type 2 diabetes with the aim of improving both patient compliance and pathophysiology of the disease.