Objective: To evaluate the available clinical data on canagliflozin and provide formulary considerations as to its place in the current treatment approach of type 2 diabetes mellitus (T2DM). Data Sources: A systematic review of the literature in MEDLINE and Web of Science was performed through July 2013 using the key words and medical subject headings canagliflozin, JNJ-28431754, TA-7284, and sodium-glucose co-transporter 2 inhibitor. A manual search of references from reports of clinical trials or review articles was performed to identify additional relevant studies. Study Selection and Data Extraction: Citations eligible for inclusion were in vitro or in vivo evaluations of canagliflozin with no restrictions on patient population or indication used. Data related to the patient populations and outcomes of interest were extracted from each citation. Data Synthesis: Five clinical trials (n = 2775 subjects) have been published evaluating canagliflozin in patients with T2DM. A single study evaluated canagliflozin monotherapy, while the others included various add-on therapies. Four studies included placebo groups with 2 others using sitagliptin as an active control. Compared with placebo (+0.14%), canagliflozin monotherapy at doses of 100 to 300 mg/d decreases hemoglobin A1c by −0.77% to −1.03% from baseline. Reductions in fasting plasma glucose, body weight, and systolic blood pressure were seen. Because of the increase in glucosuria with the drug, patients (especially females) are at increased risk of genital mycotic infections. The overall safety of canagliflozin (eg, cardiovascular, oncologic, pancreatic, bone) is also yet to be fully elucidated. Conclusions: Canagliflozin is comparable to second-line oral medications in terms of effectiveness but has limitations in affordability and long-term safety data.