Objective. This study aims to determine whether ultrasound elastography (fibroscan) is more sensitive and specific in detecting fatty liver and fibrosis as compared to ultrasound and elevated serum aminotransferase levels in patients with type 2 diabetes mellitus and metabolic syndrome. Methodology. All elastography results from January to December, 2013 were reviewed. A total of 102 patients met the inclusion/exclusion criteria. The sensitivity and specificity of elastograph, ultrasound, ALT and AST were computed, with fibrosis score as the surrogate gold standard. Results. Elastography was found to be more sensitive compared to ultrasound for patients with diabetes and metabolic syndrome who have high and moderate probability of fibrosis (100% vs 82.5%, p-value = 0.0036 and 96% vs 76.4%, p-value = 0.0036, respectively). The elastograph is also more specific compared to ultrasound (86.49% vs 32.43%, p-value = 0.0000) for detecting fatty liver and fibrosis. Only elastography was found to be significantly associated with the surrogate gold standard used in this study. Conclusion. Elastograph (fibroscan) is more sensitive and specific than ultrasound in detecting fatty liver in the presence of severe and moderate probability for fibrosis. Ultrasound, ALT and AST showed no correlation with fibrosis score.