Older adults with sarcopenic obesity are at high risk for type 2 diabetes mellitus (T2DM). However, few East Asians have sarcopenic obesity. Since many East Asians have insulin resistance (IR) without obesity, it is possible that older East Asians with sarcopenia and IR might be at high risk for T2DM. However, this relationship has not been studied. This cross-sectional study included 1629 older adults aged 65 to 84 years registered in the Bunkyo Health Study. All underwent a 75-g oral glucose tolerance test and handgrip strength measurement. Participants were classified into 4 groups by possible sarcopenia (handgrip strength <28 kg in men and <18 kg in women) and IR status (triglyceride glucose [TyG] index ≥8.79 for men and ≥8.62 for women [third quartile]). Modified Poisson regression was used to estimate relative risk (RR) and 95%CIs for T2DM with adjustment for confounding factors. The mean age was 73.1 ± 5.4 years. T2DM was diagnosed in 212 (13.0%) participants. After adjusting for age, sex, body mass index, use of lipid-lowering medications, hypertension, and cardiovascular disease, possible sarcopenia and IR were associated with T2DM, with their coexistence showing a notably stronger association (control: RR, 1.00 [Reference]; possible sarcopenia: RR, 1.55 [95% CI, 1.04-2.30]; IR: RR, 2.69 [95% CI, 1.99-3.65]; and IR possible sarcopenia: RR, 4.76 [95% CI, 3.34-6.79]). Possible sarcopenia based on low handgrip strength and IR based on the TyG index are independently associated with T2DM in older Japanese individuals. Their coexistence shows a particularly strong association with T2DM.