Exenatide is the first in a new class of compounds that exhibit activity similar to the naturally occurring hormone glucagon-like peptide-1 (GLP-1). Released from cells in the gut in response to food, GLP-1 binds to pancreatic beta-cell receptors to stimulate the release of insulin. Exenatide mirrors many of the effects of GLP-1, improving glycemic control through a combination of mechanisms, which include glucose-dependent stimulation of insulin secretion, suppression of glucagon secretion, slowing of gastric emptying, reduced appetite and enhanced beta-cell function. As stimulation of insulin secretion occurs only in the presence of elevated blood glucose concentrations, the risk of hypoglycemia should be greatly reduced with exenatide. In addition to positive therapeutic effects on fasting and postprandial glucose levels, exenatide treatment is associated with significant, dose-dependent reductions in glycated hemoglobin (HbA1c) from baseline and progressive reductions in body weight. Exenatide is generally well tolerated; nausea is the most commonly reported side effect, but it can be significantly reduced when a target dose of exenatide is achieved in patients with gradual dose titration. Exenatide may enable patients with type 2 diabetes to achieve glycemic control while reducing or eliminating the risk of hypoglycemia and weight gain. These would represent significant therapeutic gains.