The chemistry, pharmacology, pharmacokinetics, and clinical efficacy of acarbose, a new antidiabetic agent, are reviewed. Acarbose reversibly inhibits intestinal alpha-glucosidases, enzymes responsible for the metabolism of complex carbohydrates into absorbable monosaccharide units. This action results in a diminished and delayed rise in blood glucose following a meal, resulting in a reduction in post-prandial hyperglycemia, area under the glucose concentration-time curve, and glycosylated hemoglobin. Other effects include a reduction in postprandial insulin and variable changes in plasma lipid concentrations. In placebo-controlled trials, acarbose caused significant improvements in glycemic control indicators, including glycosylated hemoglobin. Acarbose has demonstrated additional glycemic control when added to other antidiabetic therapies, including sulfonylureas and insulin. Efficacy of acarbose appears to be comparable to or slightly less than that of sulfonylureas or metformin, although it has not been compared with maximal dose of these agents. The most commonly reported adverse drug reactions with acarbose are abdominal pain, diarrhea, and flatulence, which tend to lessen with time. Acarbose may affect the bioavailability of metformin and may be less effective when used in conjunction with intestinal adsorbents and digestive enzyme preparations. Concurrent use with hypoglycemic agents (sulfonylureas and insulin) may cause an increased frequency of hypoglycemia. Acarbose should not be used in individuals with certain intestinal disorders, including inflammatory bowel disease. The dosage should start at 25 mg one to three times daily given with the first bite of each main meal and should be adjusted to a maximum of 50 mg three times daily for patients weighing up to 60 kg or 100 mg three times daily for heavier patients. Acarbose may be considered for first-line antidiabetic therapy in certain patients and may be useful as combination therapy in selected instances. Acarbose is efficacious in improving metabolic control in non-insulin-dependent diabetes mellitus. Further evaluation of its effects on the long-term complications of diabetes is needed.