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Epigenetics is involved in the altered expression of gene networks that underlie insulin resistance and insufficiency. Major genes controlling β-cell differentiation and function, such as PAX4, PDX1, and GLP1 receptor, are epigenetically controlled. Epigenetics can cause insulin resistance through immunomediated pro-inflammatory actions related to several factors, such as NF-kB, osteopontin, and Toll-like receptors. Hereafter, we provide a critical and comprehensive summary on this topic with a particular emphasis on translational and clinical aspects. We discuss the effect of epigenetics on β-cell regeneration for cell replacement therapy, the emerging bioinformatics approaches for analyzing the epigenetic contribution to type 2 diabetes mellitus (T2DM), the epigenetic core of the transgenerational inheritance hypothesis in T2DM, and the epigenetic clinical trials on T2DM. Therefore, prevention or reversion of the epigenetic changes occurring during T2DM development may reduce the individual and societal burden of the disease.