The past 50 years have seen a growing ageing population with an increasing prevalence of type 2 diabetes mellitus (T2DM); now, nearly half of all individuals with diabetes mellitus are older adults (aged ≥65 years). Older adults with T2DM present particularly difficult challenges. For example, the accentuated heterogeneity of these patients, the potential presence of multiple comorbidities, the increased susceptibility to hypoglycaemia, the increased dependence on care and the effect of frailty all add to the complexity of managing diabetes mellitus in this age group. In this Review, we offer an update on the key pathophysiological mechanisms associated with T2DM in older people. We then evaluate new evidence relating particularly to the effects of frailty and sarcopenia, the clinical difficulties of age-associated comorbidities, and the implications for existing guidelines and therapeutic options. Our conclusions will focus on the effect of T2DM on an ageing society.