South Asians have a high prevalence of type 2 diabetes, even at a lower BMI. This review sets out our perspective and hypothesis on the reasons for this. Emerging data from epidemiological studies indicate that South Asians may have a lower ability to secrete insulin, and thus may have less compensatory reserves when challenged with unhealthy lifestyles. Thus, insulin resistance may not be the primary driver of type 2 diabetes in this population. Furthermore, data also suggest that South Asians, on average, have lower muscle mass, and may have a specific propensity to ectopic hepatic fat accumulation and for intramyocellular fat deposition, which cause further disruption in insulin action. We hypothesise that the high diabetes susceptibility in South Asians is evolutionarily set through dual parallel and/or interacting mechanisms: reduced beta cell function and impaired insulin action owing to low lean mass, which is further accentuated by ectopic fat deposition in the liver and muscle. These areas warrant further research.