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Context: Given the dramatic rise in the incidence of type 2 diabetes mellitus (T2DM) in recent decades, identifying individuals at increased risk of T2DM and validating methods to reduce their risk of disease progression is important. With more than one-third of US adults having prediabetes, a more precise stratification of absolute risk of T2DM incidence would help in prioritizing prevention efforts. Objective: To develop a simple and clinically useful schema to stratify short-term (2-year) absolute risk of T2DM. Design: Observational study of more than 77,000 adult members (age 18-75 years) from 3 Regions of the Kaiser Foundation Health Plan with prediabetes (hemoglobin A1C [HbA1C] = 5.7%-6.4%). Main Outcome Measures: The 2-year probability for development of diabetes as a function of baseline HbA1C and body mass index (BMI). Results: The 2-year risk of diabetes diagnosis varied widely by HbA1C and BMI. A small subset (5.2%) had a very high risk of T2DM developing within 2 years. Another 13.3% had a moderate 2-year risk of T2DM, whereas most (81.5%) of the population was at much lower risk. Thus, most Kaiser Foundation Health Plan members with prediabetes have only modest risk of progression to T2DM within 2 years. Conclusion: Using HbA1C and BMI, we created a simple stratification scheme to more precisely estimate risk of T2DM incidence. This will enable more efficient assignment of prevention interventions and clinical and laboratory follow-up to the small subset at highest risk, while minimizing the potentially negative effects of overdiagnosis among the majority with prediabetes who are not at high short-term risk of T2DM. [ABSTRACT FROM AUTHOR]