Nateglinide is an oral antidiabetic medication that acts through rapid, short-term stimulation of insulin production. This study was undertaken to identify the incidence and nature of adverse effects of nateglinide and to assess its efficacy in clinical practice. Patients (n = 3254) were recruited from 606 centers in Japan with a 12-week observation period. Pretreatment and posttreatment values were obtained for fasting blood glucose, postprandial blood glucose, hemoglobin A1c (HbA1c), triglycerides, cholesterol, and body mass index. All adverse events were reported, along with standard laboratory blood variables. The incidence of adverse events was 7.40%; hypoglycemia, including hypoglycemic symptoms, was reported as the most prevalent (1.62%). Adverse events were observed more frequently in patients with hepatic or renal dysfunction; no significant findings were noted in the remaining patient population. The efficacy rating determined by the treating physicians was 76.40%. HbA1c decreased by 0.81% from 7.70+/-1.53% to 6.89+/-1.22%, postprandial glucose decreased by 54.05 mg/dL from 228.91+/-73.69 mg/dL to 174.86+/-62.86 mg/dL, and fasting glucose decreased by 23.73 mg/dL from 164.15+/-51.42 mg/dL to 140.43+/-42.63 mg/dL. These effects were most marked in patients who were previously medication naïve or who had been diagnosed with diabetes for a short period. Mean body mass index decreased, and nateglinide was equally effective in obese patients. Nateglinide showed good therapeutic effect when used as the first choice in patients with a short duration of diabetes, and in those with no history of previous treatment. Moreover, nateglinide seemed to be useful for the treatment of elderly patients and obese patients.