AIMS/INTRODUCTION: To prospectively investigate whether simultaneous elevation of gamma-glutamyl transferase (GGT) and alanine aminotransferase (ALT) is associated with the increase of type 2 diabetes mellitus incidence independent of alcohol drinking, body mass index and triglycerides. METHODS: A total of 2,775 Japanese male workers who had no history of type 2 diabetes mellitus were followed. High GGT and ALT were defined as the top tertiles (GGT cutpoint: 49 IU/L, ALT cutpoint: 28 IU/L). Three groups were created using these dichotomized GGT and ALT cutpoints: both low, either high or both high. Multivariable Cox proportional hazards models were carried out adjusted for potential confounding factors. RESULTS: A total of 276 type 2 diabetes mellitus cases were identified during 12 years (27,040 person-years) of follow up. Participants with simultaneously elevated GGT and ALT had a significantly higher incidence of type 2 diabetes mellitus, even after adjustment for fasting insulin and fasting blood glucose compared with the group without GGT or ALT elevation. Similar associations were observed in non- or light-to-moderate alcohol drinkers, as well as in participants with normal weight. However, the association was weaker in participants with triglycerides <150 mg/dL. We then evaluated whether the addition of GGT and ALT would improve the prediction of type 2 diabetes mellitus incidence, and found that their inclusion significantly increased the C-statistic, net reclassification improvement and integrated discrimination improvement. CONCLUSIONS: Simultaneous elevation of GGT and ALT was significantly associated with type 2 diabetes mellitus incidence, independent of potential confounding factors, including alcohol drinking and obesity, although the association might require concomitant elevation of triglycerides. Inclusion of GGT and ALT improved type 2 diabetes mellitus risk prediction.