Introduction: A link between impaired insulin signaling in the central nervous system (CNS) and Alzheimer's disease (AD) has been proposed. Type 2diabetes mellitus (T2DM) is associated with increased risk of developing AD. Here, a literature review pertaining to possible underlying mechanisms in the association of T2DM and AD was carried out. Search Method: A literature review was performed with a focus on data from recent studies. Results: Several mechanisms have been proposed for the association of T2DM and AD. Lack of insulin signaling is suggested to a mechanism involved in amyloid and tau protein production. Under insulin resistance condition, IRS1-P13K-Akt pathway is under-regulated. This in turn results in activation of beta-secretase enzyme cleaving amyloid precursor protein (APP) from a site that leads to amyloid beta (Aβ) formation. Aβ will thereafter aggregates into amyloid plaques. Moreover, in insulin resistance condition, under-regulation of IRS1-P13K-Akt pathway gives rise to glycogen synthase kinase 3 beta (GSK3β) activation, which is inhibited in normal insulin signaling. This in turn leads to inhibition of the neuronal glucose transporter 3 (GLUT3) which worsens the hyperglycemic condition and results in a cycle of insulin signaling deficiency. GSK3β activity also directly is involved in tau protein hyperphosphorylation, which leads to the formation of tau neurofibrillary tangles. Conclusion: There is evidence to suggest for links between T2DM and AD. Several underlying mechanisms through which T2DM may affect pathophysiology of AD have been suggested. Lack of insulin signaling may be involved in tauopathy and amyloidopathy in patients with AD. Further basic and clinical studies are however required to unravel the link between T2DM and AD.