Aims/hypothesis Gene polymorphisms of TCF7L2 are associated with increased risk of type 2 diabetes and transcription factor 7-like 2 (TCF7L2) plays a role in hepatic glucose metabolism. We therefore addressed the impact of TCF7L2 isoforms on hepatocyte nuclear factor 4α (HNF4α) and the regulation of gluconeogenesis genes.Methods Liver TCF7L2 transcripts were analysed by quantitative PCR in 33 non-diabetic and 31 type 2 diabetic obese individuals genotyped for TCF7L2 rs7903146. To analyse transcriptional regulation by TCF7L2, small interfering R N A t r a n s f e c t i o n , l u c if e r a s e r e p o r t e r a n d c oimmunoprecipitation assays were performed in human hepatoma HepG2 cells. Results In livers of diabetic compared with normoglycaemic individuals, five C-terminal TCF7L2 transcripts showed increased expression. The type 2 diabetes risk allele of rs7903146 positively correlated with TCF7L2 expression in livers from normoglycaemic individuals only. In HepG2 cells, transcript and TCF7L2 protein levels were increased upon incubation in high glucose and insulin. Of the exon 13 transcripts, six were increased in a glucose doseresponsive manner. TCF7L2 transcriptionally regulated 29 genes related to glucose metabolism, including glucose-6-phosphatase. In cultured HepG2 cells, TCF7L2 did not regulate HNF4Α and FOXO1 transcription, but did affect HNF4α protein expression. The TCF7L2 isoforms T6 and T8 (without exon 13 and with exon 15/14, respectively) specifically interacted with HNF4α. Conclusions/interpretation The different levels of expression of alternative C-terminal TCF7L2 transcripts in HepG2 cells, in livers of normoglycaemic individuals carrying the rs7901346 type 2 diabetes risk allele and in livers of diabetic individuals suggest that these transcripts play a role in the pathophysiology of type 2 diabetes. We also report for the first time a protein interaction in HepG2 cells between HNF4α and the T6 and T8 isoforms of TCF7L2, which suggests a distinct role for these specific alternative transcripts.