Abstract Sodium-glucose cotransporter-2 (SGLT2) inhibitors are effective medications for type 2 diabetes (T2D), chronic kidney disease, and chronic heart failure regardless of diabetic status. However, concerns remain about their potential to reduce skeletal muscle mass. This study clearly demonstrates that tofogliflozin (Tofo), an SGLT2 inhibitor, improves skeletal muscle mitochondrial function, morphology, and performance in a mouse model of T2D with dexamethasone (Dex)-induced muscle atrophy. Obese diabetic KK-Ay mice and nondiabetic KK mice were used. Muscle atrophy was induced in the KK-Ay mice by intraperitoneal Dex injections for 2 weeks, followed by Tofo administration (0.015%) in the diet for 2 weeks. Tofo treatment enhanced exercise endurance, restored mitochondrial morphology, increased succinate dehydrogenase activity, and elevated protein expression of optic atrophy 1 and dynamin-related protein 1. These changes were associated with AMPK (adenosine monophosphate–activated protein kinase) activation and reduced expression of the mitokine growth differentiation factor-15. Although Tofo increased muscle cross-sectional area, it did not significantly affect overall body or muscle mass, nor grip strength, suggesting a preferential effect on slow-twitch oxidative fibers. Importantly, these benefits occurred without weight loss, likely due to maintained or increased food intake. These findings suggest that Tofo specifically ameliorates mitochondrial dysfunction and improves muscle quality and endurance in diabetic sarcopenia, especially under preserved nutritional conditions. Because Tofo is a highly selective SGLT2 inhibitor with distinct pharmacokinetic properties, these results are specific to Tofo and should not be generalized to all SGLT2 inhibitors. Further studies are warranted to determine whether similar effects are observed with other agents in this class.