Type 2 diabetes (T2D) is one of the major global public health concerns. The incidence of T2D is expected to increase dramatically in the coming years globally as well as in India. Development of T2D is a result of desensitization of peripheral tissue to stimulation of insulin. Skeletal muscle is responsible for the majority of postprandial glucose uptake and is of the utmost importance to maintain glucose homeostasis. T2D is manifested by structural, functional, and metabolic impairment of skeletal muscle and is characterized as the primary site of insulin resistance in T2D patients. T2D patients exhibit impaired insulin-stimulated muscle glucose uptake, fat metabolic abnormality, increased accumulated muscle fat, and a dysbalance in muscle protein synthesis and breakdown. Skeletal muscle mitochondrial dysfunction also plays an essential role in the pathogenesis of insulin resistance. Skeletal muscle fiber shift and diabetes-associated loss of muscle mass and strength further worsen insulin sensitivity. This review provides a comprehensive overview of skeletal muscle pathophysiological changes in diabetes and discusses the potential therapies targeting skeletal muscle pathophysiology to ameliorate diabetes.