Diabetes mellitus is a metabolic disease that affects most body systems such as the liver. The liver as a vital organ is essential in the regulation of blood glucose levels under physiological and pathological state. As a result of this function, the liver is susceptible to the effects of hyperglycaemia-induced oxidative stress, leading to free radical related liver injury. Diabetes mellitus type 2 is known to be associated with insulin resistance in the liver, leads to hyperglycaemia as a result of distortion of glucose metabolism. Increase in insulin resistance which is associated to oxidative stress, lipid peroxidation and abnormal inflammatory signal cascade are attributed greatly to liver damage. Increase in glycaemic levels, mainly caused by insulin resistance in type 2 diabetes mellitus affects the metabolism of lipids resulting in obesity related insulin resistance via accumulation of free fatty acids covering insulin receptors, a condition attributed to fatty liver. Insulin resistance resulting in increased glycaemic levels could also affect metabolism of carbohydrates and proteins. It can as well lead to nonalcoholic fatty liver disease, which has been reported to progress into non-alcoholic steatohepatitis, cirrhosis and hepatocellular carcinomas. The primary mechanism of diabetes that contributes to liver damage is the combination of increased oxidative stress and an abnormal inflammatory response, which in turn activates the transcription of proapoptotic genes and hepatocyte damage.