Insulin resistance is a major risk factor for diseases such as type 2 diabetes and metabolic syndrome. Current methods for management of insulin resistance include pharmacological therapies and lifestyle modifications. Several clinical studies have shown that leguminous plants such as soybeans and pulses (dried beans, dried peas, chickpeas, lentils) are able to reduce insulin resistance and related type 2 diabetes parameters. However, to date, no one has summarized the evidence supporting a mechanism of action for soybeans and pulses that explains their ability to lower insulin resistance. While it is commonly assumed that the biological activities of soybeans and pulses are due to their antioxidant activities, these bioactive compounds may operate independent of their antioxidant properties and, thus, their ability to potentially improve insulin sensitivity via alternative mechanisms needs to be acknowledged. Based on published studies using in vivo and in vitro models representing insulin resistant states, the proposed mechanisms of action for insulin-sensitizing actions of soybeans, chickpeas, and their bioactive compounds include increasing glucose transporter-4 levels, inhibiting adipogenesis by down-regulating peroxisome proliferator-activated receptor-γ, reducing adiposity, positively affecting adipokines, and increasing short-chain fatty acid-producing bacteria in the gut. Therefore, this review will discuss the current evidence surrounding the proposed mechanisms of action for soybeans and certain pulses, and their bioactive compounds, to effectively reduce insulin resistance.