Insulin plays a central role in glucose homeostasis, and impairment of insulin action causes glucose intolerance and leads to type 2 diabetes mellitus (T2DM). A decrease in the transient peak and sustained increase of circulating insulin following an infusion of glucose accompany T2DM pathogenesis. However, the mechanism underlying this abnormal temporal pattern of circulating insulin concentration remains unknown. Here we show that changes in opposite direction of hepatic and peripheral insulin clearance characterize this abnormal temporal pattern of circulating insulin concentration observed in T2DM. We developed a mathematical model using a hyperglycemic and hyperinsulinemic-euglycemic clamp in 111 subjects, including healthy normoglycemic and diabetic subjects. The hepatic and peripheral insulin clearance significantly increase and decrease, respectively, from healthy to borderline type and T2DM. The increased hepatic insulin clearance reduces the amplitude of circulating insulin concentration, whereas the decreased peripheral insulin clearance changes the temporal patterns of circulating insulin concentration from transient to sustained. These results provide further insight into the pathogenesis of T2DM, and thus may contribute to develop better treatment of this condition.