Morbid obesity is associated with serious co-morbidities as cardiovascular disease, insulin resistance (IR) and type 2 diabetes (T2DM). Conventional therapy for T2DM consists of weight loss and pharmacotherapy. Recently, surgery was suggested to be the best treatment for T2DM in morbid obese patients. This review will focus on the effects of bariatric surgery on T2DM. The outcomes of different bariatric techniques will be discussed. Moreover, the question why weight loss is advantageous in treating T2DM will be addressed. In this view, the effect of decreased nutrient intake, decreased intracellular fatty acid accumulation as well as decreased body fat mass on T2DM are discussed.