Diabetes, especially type 2 diabetes mellitus (T2DM), has become one of the most serious chronic diseases in the world. Its complications significantly burden patients' quality of life and the healthcare system. The liver is a vital metabolic organ that plays an important role in the occurrence and development of diabetes. This article focuses on the molecular mechanisms of T2DM caused by hepatic lipid accumulation and the related T2DM treatments. Research studies have found that excessive hepatic lipid accumulation can lead to insulin resistance and metabolic disorders through various mechanisms. Lipotoxic metabolites interfere with insulin signaling, affect the expression of genes involved in gluconeogenesis and glycolysis, and release pro‑inflammatory cytokines, such as TNF‑α and IL‑6, further impairing insulin sensitivity. Mitochondrial dysfunction generates large amounts of reactive oxygen species, causing endoplasmic reticulum stress and cellular injury or death. These pathological changes collectively exacerbate insulin resistance and ultimately lead to T2DM development. Therefore, identification of early hepatic lipid accumulation and intervention are crucial for T2DM prevention and management.