The sodium-glucose co-transporter-2 (SGLT2) is a low-affinity transport system that is specifically expressed in the kidney and plays an important role in renal glucose reabsorption in the proximal tubule. Competitive inhibition of SGLT2 therefore represents an innovative therapeutic strategy for the treatment of hyperglycaemia and/or obesity in patients with type 1 or type 2 diabetes by enhancing glucose and energy loss through the urine. The observation that individuals with familial renal glycosuria maintain normal long-term kidney function provides some reassurance that this mode of action will not adversely affect renal function. Intense research in this therapeutic area has led to the discovery of novel SGLT2 inhibitors, each with different chemical, pharmacodynamic and pharmacokinetic profiles. This review outlines the biology, expression and pleotropic activity of the SGLT system and the pharmacological profile of SGLT2 inhibitors and provides a summary of preclinical and limited clinical data available to characterize the efficacy, safety and potential clinical utility of SGLT2 inhibitors in the management of diabetes.