The aim of this review is to examine the current scientific knowledge on the relationship between diet and Type 2 diabetes and consider further implications for public health. The review focuses on the main nutritional elements which have been identified as significant in the prevention and management of Type 2 diabetes. Research findings on the role of carbohydrate, fiber, alcohol, and individual fatty acids are discussed, while the role of specific micro-nutrients and the influence of obesity are comprehensively presented. The association between dietary habits and Type 2 diabetes etiology and management is also reviewed, in order to examine the positive effects of adherence to a healthy dietary pattern, including the plausible role of the Mediterranean diet.