With the increase in prediabetes among adolescents with overweight and obesity, identifying those at highest risk for type 2 diabetes (T2D) can support prevention strategies. To assess T2D risk by hemoglobin A1c (HbA1c) levels among adolescents with overweight and obesity. This retrospective cohort study was conducted using data for January 1, 2010, to December 31, 2019, from a large California health care system. The study population comprised adolescents aged 10 to 17 years who had a body mass index (BMI; calculated as weight in kilograms divided by height in meters squared) at or above the 85th percentile, had HbA1c measured during 2010 to 2018, and did not have preexisting diabetes. Data abstraction and analyses were conducted from January 1, 2020, to November 16, 2023. Baseline HbA1c, with covariates including BMI category (overweight: 85th to <95th percentile; moderate obesity: 100% to <120% of 95th percentile; or severe obesity: ≥120% of 95th percentile), age, sex, race and ethnicity, and Neighborhood Deprivation Index score. The main outcome was incident T2D during follow-up through 2019, including cumulative incidence and multivariable hazard ratios (HRs) with 95% CIs using Cox proportional hazard regression analyses. This study included 74 552 adolescents with a mean (SD) age of 13.4 (2.3) years. More than half (50.6%) were female; 26.9% of individuals had overweight, 42.3% had moderate obesity, and 30.8% had severe obesity. Individuals identified as Asian or Pacific Islander (17.6%), Black (11.1%), Hispanic (43.6%), White (21.6%), and other or unknown race or ethnicity (6.1%). During follow-up, 698 adolescents (0.9%) developed diabetes, and 626 (89.7%) had T2D; 72 individuals (10.3%) who had type 1, secondary, or other diabetes were censored. The overall T2D incidence was 2.1 (95% CI, 1.9-2.3) per 1000 person-years, with a 5-year cumulative incidence of 1.0% (95% CI, 0.9%-1.1%). Higher baseline HbA1c (from <5.5% to 5.5%-5.6%, 5.7%-5.8%, 5.9%-6.0%, 6.1%-6.2%, and 6.3-6.4%) was associated with higher 5-year cumulative T2D incidence (from 0.3% [95% CI, 0.2%-0.4%] to 0.5% [0.4%-0.7%], 1.1% [0.8%-1.3%], 3.8% [3.2%-4.7%], 11.0% [8.9%-13.7%], and 28.5% [21.9%-36.5%], respectively). In addition, higher baseline HbA1c was associated with greater T2D risk (reference [HbA1c <5.5%]: HR, 1.7 [95% CI, 1.3-2.2], 2.8 [2.1-3.6], 9.3 [7.2-12.1], 23.3 [17.4-31.3], and 71.9 [51.1-101.1], respectively). Higher BMI category, older age, female sex, and Asian or Pacific Islander race (HR, 1.7 [95% CI, 1.3-2.2]), but not Black race or Hispanic ethnicity (compared with White race), were also independent indicators of T2D. In stratified analyses, incremental risk associated with higher HbA1c was greater for Asian or Pacific Islander and White adolescents than for Black and Hispanic adolescents. In this cohort study of adolescents with overweight and obesity, T2D risk increased substantially with baseline HbA1c above 6.0%. Risk varied by BMI, age, sex, and race and ethnicity. These findings suggest that diabetes surveillance in adolescents should be tailored to optimize identification among high-risk subgroups.