BACKGROUND: Diabetes mellitus is defined as abnormal increase in levels of sugar (glucose) in the blood. Diabetes is a chronic (long-lasting) disease that affects how your body turns food into energy. In people with diabetes, blood sugar levels remain high. This may be because insulin is not being produced at all or is not made at sufficient levels, or is not as effective as it should be. The most common forms of diabetes are type 1diabetes (5%), which is an autoimmune disorder, and type 2 diabetes (95%), which is associated with obesity. Gestational diabetes is a form of diabetes that occurs in pregnancy, and other forms of diabetes are very rare and are caused by a single gene mutation. OBJECTIVE: The present study was undertaken to study the drug utilization pattern of anti-diabetic drugs in diabetic patients. METHOD: A six-month prospective observational study was carried out at Shadan teaching and general hospital, Peerancheru (Hyderabad). The data was collected from the case sheets of in patients and OPD cards of outpatients and critically analyzed using predetermined criteria. RESULTS: Out of 250 patients, 110(44%) patients were males and 140(56%) patients were females. It is observed that diabetes mellitus II is more common in patients of age groups (51-60) years. Pharmacotherapy revealed that 210 (81.6%) patients were treated with monotherapy followed by 34 (14%) patients with 2 drug therapy and 6 (4.4%) patients were prescribed with 3 drug therapy. Metformin was the drug of choice in monotherapy while metformin along with glimepiride was the preferred drug combination used in both 2 drug and 3 drug therapies. The overall drug usages in this study revealed that a total number of 301 drugs were prescribed. Out of which, metformin was most prescribed [128 (42.52%)]. CONCLUSION: Periodic evaluation of drug utilization patterns need to be done to provide suitable medications profile in prescription of drugs to increase the therapeutic benefit and reduce the adverse effects. The study of prescribing patterns require regular monitoring and evaluation and if necessary, suggestion of modification in prescribing pattern of medical practitioners to make medical care rational and cost effective. The current anti diabetic drugs includes insulin preparation and oral hypoglycemic agents (OHA), the preference is given mostly to metformin which is first choice of drug but the other drugs such as human insulin is also prescribed for many patients, also some combinations of (OHA) drugs are also preferred.