OBJECTIVE Impaired insulin sensitivity is associated with hyperfiltration (i.e., elevated glomerular filtration rate [GFR]) in adolescents with type 2 diabetes (T2D) and adults with prediabetes. Yet, these relationships are based on studies that relied on estimated GFR (eGFR), estimates of insulin sensitivity, or both. We aimed to verify the relationship between insulin sensitivity and renal hemodynamic function by gold standard methods in adults with T2D. RESEARCH DESIGN AND METHODS Insulin sensitivity was assessed by hyperinsulinemic-euglycemic clamp (M value) (glucose infusion rate in mg/kglean/min) and renal hemodynamic function by urinary inulin (GFR) and para-aminohippuric acid (effective renal plasma flow [ERPF]) clearances in participants with T2D without overt kidney disease. Filtration fraction (FF) (GFR/ERPF) was calculated. Relationships between insulin sensitivity and renal hemodynamic parameters were examined by multivariable linear regression. Renal hemodynamic parameters were examined across tertiles of M values. RESULTS We tested 44 adults with T2D, of whom 77% were male, with mean ± SD age 63 ± 7 years, BMI 31.2 ± 4.0 kg/m2, and HbA1c 7.4 ± 0.6%. Average GFR was 110 ± 26 mL/min, with an FF of 22.1 ± 2.8% and median 24-h urinary albumin excretion of 11.3 mg (interquartile range 5.8–17.0). Average M value was 5.6 ± 2.9 mg/kglean/min. Insulin sensitivity inversely correlated with GFR (r = −0.44, P < 0.01) and FF (r = −0.40, P < 0.01), and these associations remained significant after multivariable adjustments for age, sex, renin-angiotensin system inhibitor use, and HbA1c. In addition, GFR, FF, and urinary albumin excretion were highest in the participants in the lowest M value tertile. CONCLUSIONS For the first time, we demonstrate that impaired insulin sensitivity is associated with intrarenal hemodynamic dysfunction by gold standard techniques in adults with T2D treated with metformin monotherapy.