AIMS/HYPOTHESIS: A better understanding of the mechanisms underlying an elevated infection risk in individuals with type 2 diabetes is needed to guide risk stratification and prevention. We investigated the risk of infection in subgroups of individuals with type 2 diabetes according to indices of insulin sensitivity and beta cell function. METHODS: We classified 7265 individuals with recently diagnosed type 2 diabetes (median duration 1.4 years, IQR 0.5-2.9 years) into hyperinsulinaemic (high beta cell function [HOMA 2-beta-cell function, HOMA2-B], low insulin sensitivity [HOMA 2-insulin sensitivity, HOMA2-S]), classical (low HOMA2-B, low HOMA2-S) and insulinopenic (low HOMA2-B, high HOMA2-S) type 2 diabetes. Individuals were followed until first hospital-treated infection or first prescription for an anti-infective agent (community-treated infection). We used Cox regression analysis to estimate HRs adjusted for age, sex, index year, diabetes duration and treatment, lifestyle behaviours and comorbidities. RESULTS: Among study participants, 28% had hyperinsulinaemic, 63% had classical and 9% had insulinopenic type 2 diabetes. The 10 year risks of hospital-treated infections were 42.3%, 36.8% and 31.0% in the three subgroups, respectively. Compared with the insulinopenic subgroup, adjusted HRs for hospital-treated infections were elevated for hyperinsulinaemic (1.38 [95% CI 1.16, 1.65]) and classical type 2 diabetes (1.20 [95% CI 1.02, 1.42]). The 10 year risks of community-treated infections were high in all three subgroups at 91.6%, 90.1% and 88.3%, respectively, corresponding to adjusted HRs of 1.20 (95% CI 1.08, 1.33) for the hyperinsulinaemic and 1.10 (95% CI 1.00, 1.21) for the classical subgroup. Infection risk in the hyperinsulinaemic subgroup decreased substantially when further adjusted for abdominal obesity, metabolic derangements and low-grade inflammation. CONCLUSIONS/INTERPRETATION: The risk of severe infections is clearly elevated in individuals with type 2 diabetes characterised by a higher degree of insulin resistance/hyperinsulinaemia.