AbstractSleep disorders are linked to development of type 2 diabetes and increase the risk of developing diabetes complications. Treating sleep disorders might therefore play an important role in the prevention of diabetes progression. However, the detection and treatment of sleep disorders are not part of standardised care for people with type 2 diabetes. To highlight the importance of sleep disorders in people with type 2 diabetes, we provide a review of the literature on the prevalence of sleep disorders in type 2 diabetes and the association between sleep disorders and health outcomes, such as glycaemic control, microvascular and macrovascular complications, depression, mortality and quality of life. Additionally, we examine the extent to which treating sleep disorders in people with type 2 diabetes improves these health outcomes. We performed a literature search in PubMed from inception until January 2021, using search terms for sleep disorders, type 2 diabetes, prevalence, treatment and health outcomes. Both observational and experimental studies were included in the review. We found that insomnia (39% [95% CI 34, 44]), obstructive sleep apnoea (55–86%) and restless legs syndrome (8–45%) were more prevalent in people with type 2 diabetes, compared with the general population. No studies reported prevalence rates for circadian rhythm sleep–wake disorders, central disorders of hypersomnolence or parasomnias. Additionally, several cross-sectional and prospective studies showed that sleep disorders negatively affect health outcomes in at least one diabetes domain, especially glycaemic control. For example, insomnia is associated with increased HbA_1c levels (2.51 mmol/mol [95% CI 1.1, 4.4]; 0.23% [95% CI 0.1, 0.4]). Finally, randomised controlled trials that investigate the effect of treating sleep disorders in people with type 2 diabetes are scarce, based on a small number of participants and sometimes inconclusive. Conventional therapies such as weight loss, sleep education and cognitive behavioural therapy seem to be effective in improving sleep and health outcomes in people with type 2 diabetes. We conclude that sleep disorders are highly prevalent in people with type 2 diabetes, negatively affecting health outcomes. Since treatment of the sleep disorder could prevent diabetes progression, efforts should be made to diagnose and treat sleep disorders in type 2 diabetes in order to ultimately improve health and therefore quality of life. Graphical abstract