In various populations worldwide, common variants of the TCF7L2 (Transcription factor 7-like 2) gene are associated with the risk of type 2 diabetes mellitus (T2DM). The aim was to investigate the association between rs12255372 (G/T) polymorphism in the TCF7L2 gene and T2DM in an Iranian population. 236 unrelated patients with T2DM, and 255 normoglycemic controls without diabetes were studied. The PCR-RFLP method was used for genotyping rs12255372 (G/T) polymorphism, and the SPSS version 18.0 for Windows for statistical analysis. The minor T allele of TCF7L2 rs12255372 was found to significantly increase the risk of T2DM, with an allelic odds ratio (OR) of 1.458 (95% CI 1.108–1.918, p = 0.007). A significant difference in TT genotype was observed between T2DM patients and normoglycemic controls (OR 2.038, 95% CI 1.147–3.623; p = 0.014). On assuming dominant and recessive models, ORs of 1.52 [95% CI (1.05–2.21) p = 0.026)] and 1.74 [95% CI (1.01–3.00) p = 0.043] were obtained, respectively, thereby implying that the co-dominant model would best fit the susceptible gene effect. This study further confirms the TCF7L2 gene as enhancing susceptibility to the development of T2DM.