The aim of this study was to investigate the effects of ileal interposition (IT) on glucose and insulin resistance (IR) in type 2 diabetic mellitus (T2DM), and the role of T-cell factor 7-like 2 (TCF7L2), formerly known as TCF4, in the downregulation of hyperglycemia following IT. Goto-Kakizaki (GK) rats subjected to IT surgery (GK-IT group), GK rats subjected to sham surgery (GK-Sham group) and Wistar (WS) rats subjected to sham surgery (WS-Sham group) were investigated in this study. Fasting plasma glucose, body weight, food intake per 1 kg body weight, insulin and a homeostasis model assessment of insulin resistance (HOMA-IR) were measured pre- and post-surgery. The rats were euthanized 28 days post-surgery and the pancreas of each rat was dissected. The expression levels of TCF7L2 mRNA and protein were analyzed by quantitative RT-PCR and western blotting, respectively. Our results revealed that IT improved both fasting plasma glucose levels and IR in GK rats by upregulating the expression of the TCF7L2 protein. IT provides a valuable therapeutic option for patients with T2DM. Upregulation of TCF7L2 protein expression may be a possible mechanism underlying the improvement of T2DM following IT.