Abstract Researchers in diabetes genetics first became aware of the importance of transcription factor genes in 1996, when two seminal papers described mutations in hepatocyte nuclear factor (HNF)1α and HNF4α as causes of the beta-cell disorder, maturity onset diabetes of the young (MODY). Since then, mutations in the HNF1β, insulin promoter factor (IPF)1 and NeuroD genes, have been described as causes of MODY. Rare mutations in the transcription factor peroxisome proliferative-activated receptor γ (PPARG) have been described as a cause of diabetes associated with severe insulin resistance. Recently researchers have described the importance of common variation in these genes in type 2 diabetes risk. Here, we review the evidence for common variants of transcription factor genes predisposing to type 2 diabetes. We briefly summarise the evidence for the role of the Pro12Ala variant of PPARG in type 2 diabetes and related disorders, as this has been the subject of extensive previous reviews. The evidence that subjects carrying at least one copy of the Ala allele are at reduced risk of type 2 diabetes has now gone beyond the stringent levels of significance required for genetic association studies. Of the MODY transcription factor genes that have been extensively analysed, there is strong evidence that variants of HNF1 α and HNF4 α predispose to type 2 diabetes. We conclude that further, comprehensive analyses are needed of all transcription factor genes where rare mutations cause a Mendelian disorder related to type 2 diabetes.