Impaired mitochondrial function is implicated in the development of type 2 diabetes mellitus (T2DM). This was investigated in mitochondria from skeletal muscle and liver of the Goto-Kakizaki (GK) rat, which spontaneously develops T2DM with age. The early and the manifest stage of T2DM was studied in 6- and 16-wk-old GK rats, respectively. In GK16 compared with GK6 animals, a decrease in state 3 respiration with palmitoyl carnitine (PC) as substrate was observed in muscle. Yet an increase was seen in liver. To test the complex II contribution to the state 3 respiration, succinate was added together with PC. In liver mitochondria, this resulted in an ∼50% smaller respiratory increase in the GK6 group compared with control and no respiratory increase at all in the GK16 animals. Yet no difference between groups was seen in muscle mitochondria. RCR and P/O ratio was increased (P < 0.05) in liver but unchanged in muscle in both GK groups. We observed increased lipid peroxidation and decreased Akt phosphorylation in liver with the progression of T2DM but no change in muscle. We conclude that, during the progression of T2DM in GK rats, liver mitochondria are affected earlier and/or more severely than muscle mitochondria. Succinate dehydrogenase flux in the presence of fatty acids was reduced severely in liver but not in muscle mitochondria during manifest T2DM. The observations support the notion that T2DM pathogenesis is initiated in the liver and that only later are muscle mitochondria affected.