The essential trace element selenium has long been considered to exhibit anti-diabetic and insulin-mimetic properties, but recent epidemiological studies indicated supranutritional selenium intake and high plasma selenium levels as possible risk factors for development of type 2 diabetes, pointing to adverse effects of selenium on carbohydrate metabolism in humans. However, increased plasma selenium levels might be both a consequence and a cause of diabetes. We summarize current evidence for an interference of selenium compounds with insulin-regulated molecular pathways, most notably the phosphoinositide-3-kinase/protein kinase B signaling cascade, which may underlie some of the pro- and anti-diabetic actions of selenium. Furthermore, we discuss reports of hyperinsulinemia, hyperglycemia and insulin resistance in mice overexpressing the selenoenzyme glutathione peroxidase 1. The peroxisomal proliferator-activated receptor gamma coactivator 1α represents a key regulator for biosynthesis of the physiological selenium transporter, selenoprotein P, as well as for hepatic gluconeogenesis. As proliferator-activated receptor gamma coactivator 1α has been shown to be up-regulated in livers of diabetic animals and to promote insulin resistance, we hypothesize that dysregulated pathways in carbohydrate metabolism and a disturbance of selenium homeostasis are linked via proliferator-activated receptor gamma coactivator 1α.