The main biguanides, metformin and phenformin, were introduced in 1957 as oral glucose-lowering agents to treat non-insulin-dependent diabetes mellitus (NIDDM). Phenformin was withdrawn in many countries because of an association with lactic acidosis, but metformin does not have the same risk if appropriately prescribed. Metformin is now widely used as a monotherapy and in combination with a sulfonylurea. Unlike sulfonylureas, metformin is not bound to plasma proteins, is not metabolized, and is eliminated rapidly by the kidney. The glucose-lowering effect occurs without stimulation of insulin secretion and results mainly from increased glucose utilization. The presence of insulin is required, and enhancement of insulin action at the postreceptor level occurs in peripheral tissues such as muscle. In peripheral tissues metformin increases insulin-mediated glucose uptake and oxidative metabolism. Metformin also increases glucose utilization by the intestine, primarily via nonoxidative metabolism. The extra lactate produced is largely extracted by the liver and serves as a substrate to sustain gluconeogenesis. This limits the extent to which metformin reduces hepatic glucose production but provides a safeguard against excessive glucose lowering. Because metformin does not cause clinical hypoglycemia, it is actually an antihyperglycemic drug. It does not cause weight gain, it helps combat hypertriglyceridemia, and it has been ascribed some vasoprotective properties. Metformin offers a useful treatment for insulin-resistant overweight NIDDM patients.