AIM: To study cognitive functions in type T2D and the effect of insulin resistance on it. METHODS: In the present study, cognitive function tests were done for 37 subjects; control (n = 17), type 2 DM (n = 20).These tests include mini mental state examination (MMSE), Wechsler adult intelligence scale (WAIS), Wechsler memory scale (WMS) and Cognitive Event related potential (P300). Circulating levels of glycosylated haemoglobin (HbA1c) and insulin were determined in venous blood samples of both groups. RESULTS: MMSE was significantly lower in type T2D than control group (p = 0.034). However no significant difference between type T2D and control group in WAIS and WMS except in visual reproduction (p = 0.048). P300 latency was significantly longer in type T2D than controls (p = 0.0001). P300 amplitude was decreased significantly in type T2D than controls (p = 0.0001). HbA1c and insulin was significantly higher in type T2D than controls (p = 0.0001). CONCLUSION: Type T2D is associated with cognitive impairment due to insulin resistance.