Adiponectin is an adipocyte-derived peptide, which has antiinflammatory and insulin-sensitising properties. We designed a nested case-control study to assess whether baseline adiponectin concentrations in plasma are independently associated with risk of type 2 diabetes. We found that adiponectin concentrations in plasma were lower among individuals who later developed type 2 diabetes than among controls (mean 5·34 μg/mL [SD 3·49] vs 6·87 μg/mL [4·58], p<0·0001). High concentrations of adiponectin were associated with a substantially reduced relative risk of type 2 diabetes after adjustment for age, sex, waist-to-hip ratio, body-mass index, smoking, exercise, alcohol consumption, education, and glycosylated haemoglobin A_1c (odds ratio 4th vs 1st quartile 0·3 [95% CI 0·2–0·7], p=0·0051). We conclude that adiponectin is independently associated with a reduced risk of type 2 diabetes in apparently healthy individuals.