Background: Type 2 diabetes (T2DM) mellitus is a serious implication of obesity. The effect of insulin therapy on levels of inflammatory markers among obese and non-obese diabetics has been inadequately studied. Aim: The study aimed to analyze the preinsulin and postinsulin levels of tumor necrosis factor a (TNF-alpha) and IL-6 in nonobese and obese T2DM patients. Materials and Methods: We assessed TNF-alpha and IL-6 levels in healthy controls (n=10) and diabetic patients (obese and nonobese; n=20 each) and analyzed the postinsulin effect on TNF-alpha and IL-6 levels after 24 and 48 weeks. TNF-alpha and IL-6 levels were also correlated with fasting plasma glucose of obese and nonobese diabetic patients after insulin therapy. Results: There is augmentation of TNF-alpha and IL-6 levels in diabetic patients and augmentation is more in obese than in nonobese diabetics. The obese group showed a significant decrease (P value < 0.05) after 24 weeks of insulin therapy and an extremely significant decrease (P < 0.001) in TNF-alpha and IL-6 levels after 48 weeks of therapy. The nonobese group showed an extremely significant decrease (P < 0.001) in TNF-alpha and IL-6levels after 24 and 48 weeks both. Conclusion: There is augmented inflammation in diabetes and it is more in obese diabetics. Insulin therapy tends to counter this inflammation, but the response is delayed in obese diabetics.