Regular physical activity and low levels of prolonged sedentary behaviour are important lifestyle recommendations for the management of type 2 diabetes. This systematic review collates and summarises published research reporting on physical activity and sedentary behaviour of adults with type 2 diabetes. Systematic searches with three databases were conducted (Medline; PubMed; SportDiscus). Intervention studies were excluded. Studies were eligible if they: (i) were published in English; (ii) were published between 1997 and January 2017; and (iii) objectively and/or subjectively measured physical activity and/or sedentary behaviour in adults with type 2 diabetes. Two reviewers independently cross‐checked studies, conducted a quality assessment and extracted data. Data were analysed using descriptive statistics and a narrative synthesis. The search identified 349 studies; 29 eligible studies were included. All studies measured physical activity and 15 studies measured sedentary behaviour. Twenty studies used subjective methods, six used objective methods and three used both subjective and objective methods. Most studies report low levels of physical activity and high levels of sedentary behaviour in adults with type 2 diabetes and note adults with type 2 diabetes to be less active and more sedentary than those without type 2 diabetes. Regardless of measurement method or study location, adults with type 2 diabetes report low levels of physical activity and high levels of sedentary behaviour and are less active and more sedentary than those without type 2 diabetes. There is a need for large‐scale interventions which support active lifestyles to be implemented into diabetes care. Copyright © 2018 John Wiley & Sons.