The objective of the present study was to develop a rat model that replicates the natural history and metabolic characteristics of human type 2 diabetes and is also suitable for pharmacological screening. Male Sprague-Dawley rats (160-180 g) were divided into two groups and fed with commercially available normal pellet diet (NPD) (12% calories as fat) or in-house prepared high-fat diet (HFD) (58% calories as fat), respectively, for a period of 2 weeks. The HFD-fed rats exhibited significant increase in body weight, basal plasma glucose (PGL), insulin (PI), triglycerides (PTG) and total cholesterol (PTC) levels as compared to NPD-fed control rats. Besides, the HFD rats showed significant reduction in glucose disappearance rate (K-value) on intravenous insulin glucose tolerance test (IVIGTT). Hyperinsulinemia together with reduced glucose disappearance rate (K-value) suggested that the feeding of HFD-induced insulin resistance in rats. After 2 weeks of dietary manipulation, a subset of the rats from both groups was injected intraperitoneally with low dose of streptozotocin (STZ) (35 mg kg(-1)). Insulin-resistant HFD-fed rats developed frank hyperglycemia upon STZ injection that, however, caused only mild elevation in PGL in NPD-fed rats. Though there was significant reduction in PI level after STZ injection in HFD rats, the reduction observed was only to a level that was comparable with NPD-fed control rats. In addition, the levels of PTG and PTC were further accentuated after STZ treatment in HFD-fed rats. In contrast, STZ (35 mg kg(-1), i.p.) failed to significantly alter PI, PTG and PTC levels in NPD-fed rats. Thus, these fat-fed/STZ-treated rats simulate natural disease progression and metabolic characteristics typical of individuals at increased risk of developing type 2 diabetes because of insulin resistance and obesity. Further, the fat-fed/STZ-treated rats were found to be sensitive for glucose lowering effects of insulin sensitizing (pioglitazone) as well as insulinotropic (glipizide) agents. Besides, the effect of pioglitazone and glipizide on the plasma lipid parameters (PTG and PTC) was shown in these diabetic rats. The present study represents that the combination of HFD-fed and low-dose STZ-treated rat serves as an alternative animal model for type 2 diabetes simulating the human syndrome that is also suitable for testing anti-diabetic agents for the treatment of type 2 diabetes.