Impaired glucose tolerance (IGT) and impaired fasting glucose (IFG) are intermediate states in glucose metabolism that exist between normal glucose tolerance and overt diabetes. Epidemiological studies demonstrate that the two categories describe distinct populations with only partial overlap, suggesting that different metabolic abnormalities characterize IGT and IFG. Insulin resistance and impaired beta-cell function, the primary defects observed in type 2 diabetes, both can be detected in subjects with IGT and IFG. However, clinical studies suggest that the site of insulin resistance varies between the two disorders. While subjects with IGT have marked muscle insulin resistance with only mild hepatic insulin resistance, subjects with IFG have severe hepatic insulin resistance with normal or near-normal muscle insulin sensitivity. Both IFG and IGT are characterized by a reduction in early-phase insulin secretion, while subjects with IGT also have impaired late-phase insulin secretion. The distinct metabolic features present in subjects with IFG and IGT may require different therapeutic interventions to prevent their progression to type 2 diabetes.