Aim: To investigate the acute and chronic effects of nateglinide versus acarbose on plasma asymmetric dimethylarginine (ADMA) levels and lipid profiles in patients with newly diagnosed type 2 diabetes. Methods: A crossover trial of nateglinide and acarbose was conducted on 16 drug-naïve patients with newly diagnosed type 2 diabetes during a total period of 9 weeks. Plasma glucose, serum insulin, free fatty acids (FFA), lipids and lipoproteins, and plasma ADMA were measured. Results: The efficiencies of a single dose of nateglinide (120 mg) and acarbose (50 mg) for lowering postprandial hyperglycemia were similar. Compared to acarbose, nateglinide significantly increased postprandial insulin release after a standard meal test in patients with type 2 diabetes. Nateglinide acutely decreased postprandial 120-min FFA concentrations and 240-min ADMA levels more significantly than acarbose. The fasting high-density lipoprotein cholesterol (HDL-C) level increased and the low-density lipoprotein cholesterol (LDL-C) level decreased significantly, but the fasting levels of triglycerides, total cholesterol, and ADMA were unchanged after 4 weeks of treatment with nateglinide. Acarbose did not affect fasting lipid profiles or the ADMA levels after 4 weeks of treatment. Conclusion: These results suggest that the reduction of postprandial FFA and ADMA concentrations induced by nateglinide may be associated with the partial restoration of early phase insulin secretion and may impart a cardiovascular advantage in comparison with acarbose.