Glucagon-like peptide-1 (GLP-1) is a peptide hormone from the gut that stimulates insulin secretion and protects beta-cells, inhibits glucagon secretion and gastric emptying, and reduces appetite and food intake. In agreement with these actions, it has been shown to be highly effective in the treatment of Type 2 diabetes, causing marked improvements in glycaemic profile, insulin sensitivity and beta-cell performance, as well as weight reduction. The hormone is metabolised rapidly by the enzyme dipeptidyl peptidase IV (DPP-IV) and, therefore, cannot be easily used clinically. Instead, resistant analogues of the hormone (or agonists of the GLP-1 receptor) are in development, along with DPP-IV inhibitors, which have been demonstrated to protect the endogenous hormone and enhance its activity. Agonists include both albumin-bound analogues of GLP-1 and exendin-4, a lizard peptide. Clinical studies with exendin have been carried out for > 6 months and have indicated efficacy in patients inadequately treated with oral antidiabetic agents. Orally active DPP-IV inhibitors, suitable for once-daily administration, have demonstrated similar efficacy. Diabetes therapy, based on GLP-1 receptor activation, therefore, appears very promising.