Abnormal elevation of hepatic gluconeogenesis is central to the onset of hyperglycaemia in patients with type 2 diabetes mellitus (T2DM). Metformin corrects hyperglycaemia through inhibition of gluconeogenesis, but its mechanism of action is yet to be fully described. SIRT1 and GCN5 (listed as KAT2A in the MGI Database) have recently been identified as regulators of gluconeogenic gene expression through modulation of levels and activity of the coactivators cAMP-response element binding protein-regulated transcription coactivator 2 (TORC2 or CRTC2 as listed in the MGI Database) and peroxisome proliferator-activated receptor-gamma coactivator-1alpha (PGC1alpha or PPARGC1A as listed in the MGI Database). We report that in db/db mice, metformin (250 mg/kg per day; 7 days) increases hepatic levels of GCN5 protein and mRNA compared with the untreated db/db mice, as well as increases levels of SIRT1 protein and activity relative to controls and untreated db/db mice. These changes were associated with reduced TORC2 protein level and decreased gene expression and activation of the PGC1alpha gene target phosphoenolpyruvate carboxykinase, and lower plasma glucose and insulin. Inhibition of SIRT1 partially blocked the effects of metformin on gluconeogenesis. SIRT1 was increased through an AMP-activated protein kinase-mediated increase in gene expression of nicotinamide phosphoribosyltransferase, the rate-limiting enzyme of the salvage pathway for NAD(+). Moreover, levels of GCN5 were dramatically reduced in db/db mice compared with the controls. This indicates that loss of GCN5-mediated inhibition of gluconeogenesis appears to constitute a major mechanism for the onset of abnormally elevated hepatic glucose production in db/db mice. In conclusion, induction of GCN5 and SIRT1 potentially represents a critical mechanism of action of metformin. In addition, these data identify induction of hepatic GCN5 as a potential therapeutic strategy for treatment of T2DM.