The advent of ‘incretin-based therapies’ – GLP-1 agonists and dipeptidyl-peptidase-4 inhibitors – which result in improvements in glycemic control comparable to those with existing oral hypoglycemic agents, and potentially improve cardiovascular and pancreatic β-cell function, represents a major therapeutic advance in the management of type 2 diabetes. Gastrointestinal adverse effects occur commonly with GLP-1 agonists, and rarely with DPP-4 inhibitors, but are dose-dependent and usually transient. The low risk of hypoglycemia, and beneficial or neutral effects on body weight, render GLP-1 agonists and DPP-4 inhibitors suitable alternatives to insulin secretagogues and insulin in overweight and elderly patients. Incretin-based therapies also improve quality of life in patients with type 2 diabetes, and may be cost-effective in the long term.