The increased prevalence of Type 2 diabetes mellitus (T2DM) in severe mental illness (SMI) contributes to increased cardiovascular morbidity and reduced life expectancy for people with SMI. Areas covered: In the present clinical review, we summarize the efficacy, safety and tolerability of selected diabetic pharmacotherapy options in SMI and discuss the quality and strength of evidence. Expert commentary: General principles for treating T2DM in SMI involve identifying treatments which promote weight loss and which have low or no risk of hypoglycemia. Patient engagement in decision making about treatment choices is an important factor to ensure adherence and successful use of the chosen therapy. The first line therapeutic option for T2DM in SMI for which there is most evidence is metformin. Based on general population data, second line treatment options in combination with metformin to achieve glycated haemoglobin treatment goals include GLP-1R agonists, DPP-4 inhibitors, sulphonylureas, SGLT2 inhibitors, pioglitazone and insulin, with most evidence for the use of GLP-1R agonists in SMI. Alongside efficacy and tolerability, treatment for T2DM in SMI should be considered on a patient-tailored basis.