Schizophrenia is a complex psychotic disorder with co-occurring conditions, including insulin resistance and type 2 diabetes (T2D). It is well established that T2D and its precursors (i.e., insulin resistance) are more prevalent in patients with schizophrenia who are treated with antipsychotics, as well as in antipsychotic-naïve patients experiencing their first episode of psychosis, compared with the general population. However, the mechanism(s) underlying the increased susceptibility, shared genetics, and possible cause-effect relationship between schizophrenia and T2D remain largely unknown. The objective of this narrative review was to synthesize important studies, including Mendelian randomization (MR) analyses that have integrated genome-wide association studies (GWAS), as well as results from in vitro models, in vivo models, and observational studies of patients with schizophrenia. Both GWAS and MR studies have found that schizophrenia and T2D/insulin resistance share genetic risk factors, and this may mediate a connection between peripheral or brain insulin resistance and T2D with cognition impairment and an increased risk of developing prediabetes and T2D in schizophrenia. Moreover, accumulating evidence supports a causal role for insulin resistance in schizophrenia and emphasizes the importance of a genetic basis for susceptibility to T2D in patients with schizophrenia before they receive psychotic treatment. The present findings and observations may have clinical implications for the development of better strategies to treat patients with schizophrenia, with both pharmacological (i.e., samidorphan, empagliflozin) and/or nonpharmacological (i.e., lifestyle changes) approaches. Additionally, this review may benefit the design of future studies by physicians and clinical investigators.