Abstract Purpose The impact of endogenous androgen levels on the risk of type 2 diabetes in women remains uncertain. The objective was to investigate associations between endogenous androgen levels and risk of type 2 diabetes in young women without established comorbidity. Methods In this retrospective cohort study, women aged 18 to 50 years who underwent measurement of plasma testosterone, dehydroepiandrosterone-sulfate (DHEA-S), dihydrotestosterone (DHT), and sex hormone-binding globulin (SHBG) for the first time from January 2007 to December 2015 were included. Androgens were analyzed using tandem liquid chromatography mass spectrometry. Women with established comorbidity were excluded, using Danish healthcare registries. We calculated incidence rate ratios (IRRs, 95% confidence intervals) of type 2 diabetes according to quartiles of plasma androgens using multivariate Poisson regression models. Results A total of 8876 women, with a mean ± SD age of 38.5 ± 4.6 years and a median (interquartile range [IQR]) follow-up duration of 8.1 (6.6-9.4) years, were eligible for analyses. During 69 728 person-years, 69 women were diagnosed with type 2 diabetes. Women in the highest quartile of plasma total testosterone and calculated free testosterone displayed increased risk of type 2 diabetes compared with the lowest quartile: IRR 1.97 (1.01; 3.85), P = .048 and IRR 7.32 (2.84; 18.83), P < .001. SHBG was inversely associated with type 2 diabetes, Q4 versus Q1; IRR 0.06 (0.02; 0.21), P < .001. Plasma DHEA-S and DHT were not associated with incident type 2 diabetes. Conclusions Higher levels of plasma total and free testosterone were associated with increased risk of type 2 diabetes among women.