The twin cycle hypothesis postulated that type 2 diabetes was a result of excess liver fat causing excess supply of fat to the pancreas with resulting dysfunction of both organs. If this was so, the condition should be able to be returned to normal by calorie restriction. The Counterpoint study tested this prediction in short‐duration type 2 diabetes and showed that liver glucose handling returned to normal within 7 days and that beta‐cell function returned close to normal over 8 weeks. Subsequent studies have demonstrated the durability of remission from type 2 diabetes. Remarkably, during the first 12 months of remission, the maximum functional beta‐cell mass returns completely to normal and remains so for at least 24 months, consistent with regain of insulin secretory function of beta cells which had dedifferentiated in the face of chronic nutrient oversupply. The likelihood of achieving remission after 15% weight loss has been shown to be mainly determined by the duration of diabetes, with responders having better beta‐cell function at baseline. Remission is independent of BMI, underscoring the personal fat threshold concept that type 2 diabetes develops when an individual acquires more fat than can be individually tolerated even at a BMI which in the nonobese range. Observations on people of South Asian or Afro‐American ethnicity confirm that substantial weight loss achieves remission in the same way as in the largely White Europeans studied in detail. Diagnosis of type 2 diabetes can now be regarded as an urgent signal that weight loss must be achieved to avoid a progressive decline of health.