Metformin often promotes weight loss in patients with obesity with non‐insulin‐dependent diabetes mellitus (NIDDM). The mechanism may be attributed to decreased food intake. This study has tested the effect of metformin on satiety and its efficacy in inducing weight loss. Twelve diet‐treated NIDDM women with obesity were randomly given two dose levels (850 mg or 1700 mg) of metformin or placebo at 0800 for three consecutive days followed by a meal test on the third day on three occasions using a 3times3 Latin square design. The number of sandwich canapes eaten in three consecutive 10‐minute periods beginning at 1400 hours was used to quantitate food intake, and the level of subjective hunger was rated just before the sandwich meal with a linear analogue hunger rating scale at 1400 after a 6‐hour fast. The prior administration of metformin produced a reduction in calorie intake after each of the two doses of metformin treatment. The 1700‐mg metformin dose had the most marked appetite suppressant action. Similarly, hunger ratings were significantly lowered after metformin, and the effect was most pronounced after the administration of 1700 mg of metformin. To assess the efficacy of metformin in reducing bodyweight, 48 diet‐treated NIDDM women with obesity who had failed to lose weight by diet therapy were first placed on a 1200‐kcal ADA (American Diabetes Association) diet before being randomized to receive either metformin (850 mg) or placebo twice daily in a double‐blind fashion for 24 weeks. A 4‐week single‐blind placebo lead‐in period preceded and a 6‐week single‐blind placebo period followed the 24‐week double‐blind treatment period. Subjects treated with metformin continued to lose weight throughout 24 weeks of treatment; their mean maximum weight loss was 8 kg greater than that of the placebo group, with corresponding lower HbA1C and fasting blood glucose levels at the end of the active treatment period. These results indicate that metformin decreases calorie intake in a dose‐dependent manner and leads to a reduction in bodyweight in NIDDM patients with obesity.