Type 2 Diabetes Mellitus (T2DM) which is characterised by insulin resistance, is closely linked to the triad of glucolipotoxicity, inflammation and oxidative stress. Increased adiposity, leading to increased free fatty acids (FFAs), contributes to insulin resistance by disrupting the signal transduction pathway of insulin mediated glucose disposal, and causes impaired insulin secretion. Hyperglycaemia and dyslipidaemia driven oxidative stress resulting from enhanced free-radical formation and/or defects in antioxidant defence is implicated in the pathogenesis of diabetic neuropathy (DN). This and other inflammatory pathways account for a complex network of interacting metabolic factors responsible for causing diabetes and her complications. There is growing evidence that Alpha Lipoic Acid (ALA) has beneficial effects on the treatment of T2DM and some of its complications. It represents an attractive pharmacological target in the treatment of T2DM by modulating the signal transduction pathways in insulin resistance and antagonizing the oxidative and inflammatory stresses, which are major players in the pathogenesis of this disorder. A potent anti-oxidant and free radical scavenger, ALA also targets cellular signal transduction pathways which increases glucose uptake and utilization, thus providing specific targeted therapy in the treatment of insulin resistance and diabetic neuropathy. Apart from the rare risk of Insulin Autoimmune Syndrome (IAS), ALA has shown to be relatively safe, even in patients with renal and liver failure. This review focuses and summarises the molecular mechanisms of T2DM, and underlines the therapeutic value of ALA in this globally significant disease.