Angiotensin II (Ang II), the major effector hormone of the renin-angiotensin system (RAS), has an important role in the regulation of vascular and renal homeostasis. Clinical and pharmacological studies have recently shown that Ang II is a critical promoter of insulin resistance and diabetes mellitus type 2. Ang II exerts its actions on insulin-sensitive tissues such as liver, muscle and adipose tissue where it has effects on the insulin receptor (IR), insulin receptor substrate (IRS) proteins and the downstream effectors PI3K, Akt and GLUT4. The molecular mechanisms involved have not been completely identified, but the role of serine/threonine phosphorylation of the IR and IRS-1 proteins in desensitization of insulin action has been well established. The purpose of this review is to highlight recent advances in the understanding of Ang II actions which lead to the development of insulin resistance and its implications for diabetes.