Type 2 diabetes mellitus (T2DM) generally occurs in adults. Adults with T2DM show hyperglycemia resulting from decreased insulin sensitivity and loss of beta cells. Chronic hyperglycemia induces dysfunction in organs such as kidney, eye, neuron and heart. Both T2DM and obesity are chronic metabolic diseases characterized by insulin resistance induced by proinflammatory cytokines and adipokines. Traditional therapies for DM such as those using diets and drugs fail to maintain normal blood glucose levels all the time, and because of the scarcity of donors, the opportunity for the replacement of beta cells by islet or pancreas transplantation is limited. Stem cell therapies could likely become an effective approach for T2DM treatment; stem cells including embryonic stem cells, induced pluripotent stem cells, bone marrow stem cells, and mesenchymal stem cells isolated from various tissues such as bone marrow, adipose tissue and umbilical cord blood. Oxidative stress causes a complex dysregulation of cell metabolism, and more particularly induces insulin resistance and beta cell dysfunction. Heme oxygenase-1 (HO-1) shows anti-oxidant effects and benefits for T2DM. In this review, we summarize the relationship between T2DM and obesity, insulin resistance and HO-1, and stem cell therapies for T2DM.