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The occurrence of liver disease and raised liver enzymes is common in Type 2 diabetes, and may be multifactorial in origin. Very few studies are available on the exact prevalence of the phenomenon, however. We carried out an observational point-prevalence study of elevated liver enzymes in eight hospital-based Italian diabetes units. Data of 9621 consecutive Type 2 diabetes patients (males, 52.4%; median age, 65 yr) were analyzed, and alanine and aspartate aminotransferase (ALT, AST) and γ-glutamyltransferase (GGT) levels were related to body mass index (BMI), metabolic control and the presence of the metabolic syndrome. ALT, AST, and GGT levels exceeding the upper limit of normal were present in 16.0%, 8.8%, 23.1%, respectively, the prevalence being higher in males, increasing with obesity class and poor metabolic control, and decreasing with age. Elevated enzymes were systematically associated with most parameters of the metabolic syndrome. After correction for age, gender, BMI, and differences across centers, elevated triglyceride levels/fibrate treatment [odds ratio (OR), 1.57; 95% confidence interval (CI), 1.34–1.84] and an enlarged waist circumference (OR, 1.47; 95% CI, 1.17–1.85) were the only parameters independently associated with high ALT. In a separate analysis, the presence of metabolic syndrome (Adult Treatment Panel III criteria) was highly predictive of raised liver enzymes. After exclusion of hepatitis B and C positive cases, tested in 2 centers, the prevalence of raised enzymes decreased by approximately 4%, but the association with the metabolic syndrome did not change significantly. In conclusion, the high prevalence of elevated liver enzymes in Type 2 diabetes is in keeping with the well-demonstrated risk of progressive liver disease. A large amount of diabetes patients may require a thorough clinical, laboratory and histological investigation.