Type 2 diabetes is a major health problem associated with excess mortality and morbidity. Vascular complications are one of the most serious consequences of this disorder. Moreover, type 2 diabetes is also a risk factor for cerebral complications, including cognitive impairment and dementia. However, it has been shown that tight glycemic control contributes to reduce the incidence of diabetes-associated complications. Metformin is a potent antihyperglycemic agent widely used in the management of type 2 diabetes whose main actions are the suppression of gluconeogenesis and the improvement of glucose uptake and insulin sensitivity. This review is mainly devoted to describe the mechanisms of action underlying the antidiabetic effects of metformin. Furthermore, we will present evidence for the protective effects of metformin against diabetes-associated complications mainly cerebral and vascular complications. Finally, we will describe the few known side effects associated to this antidiabetic agent.