Inclusion Criteria:

• Have Type II diabetes mellitus (non-insulin-dependent).
• Females must be post-menopausal (> 12 months without a menstrual period), surgically sterile, or must be using oral contraceptive, Norplant, Depo-provera, an IUD, or a diaphragm with spermicide or condoms. Females of childbearing potential must use acceptable contraceptive measures for at least one month prior to screening and for 30 days after completing the study.
• Must have been on insulin therapy alone continuously for at least 8 weeks prior to screening (minimum dose of 30 units per day). Patients taking insulin in combination with a single oral antidiabetic agent may have their oral agent discontinued and their insulin dose optimized over an 8 week period prior to screening if they are considered good study candidates in all other respects.
• HbA1c > 7.5% at Pre-screen or at Screen for subjects who discontinue their antidiabetic agent at pre-screening.
• Provide signed Informed Consent.

Exclusion Criteria:

• Females who are lactating, pregnant, or planning to become pregnant.
• Use of any drug called a thiazolidinedione within 6 months prior to screening, or more than one oral antidiabetic agent (including combinations of agents such as Glucovance) in combination with insulin in the 3 months prior to screening.
• Use of any investigational drug for blood glucose control within 3 months of screening regardless of the treatment regimen, or use of any other investigational agent within 30 days preceding study entry.
• Use of niacin (not including doses found in multivitamins) or oral corticosteroids within 3 months of screening.
• Patients with ongoing swelling due to fluid accumulation or history of such requiring treatment with a drug in the 12 months prior to screening.
• Patients with a documented history of significant hypersensitivity (e.g., difficulty swallowing, difficulty breathing, tachycardia or skin reaction) to the drugs called thiazolidinediones or similar drugs, or with prior fluid related intolerability to thiazolidinediones.
• Presence of clinically significant kidney or liver disease.
• Anemia.
• Presence of unstable or severe angina or coronary insufficiency.
• Patients with ongoing CHF (chronic heart failure) or history of CHF.
• Recent history or suspicion of current drug abuse or alcohol abuse.