Circulating bilirubin, a natural antioxidant, is associated with decreased risk of type 2 diabetes (T2D), but the nature of the relationship remains unknown. We performed Mendelian randomization in a prospective cohort of 3,381 participants free of diabetes at baseline (aged 28-75 years; women, 52.6%). We used rs6742078 located in UDP-glucuronosyltransferase (UGT1A1) locus as instrumental variable (IV) to study a potential causal effect of serum total bilirubin on T2D risk. A total of 210 (6.2%) participants developed T2D during a median follow-up of 7.8 years. In adjusted analyses, rs6742078, which explained 19.5% of bilirubin variation, was strongly associated with total bilirubin (a 0.68-SD increase in bilirubin levels per T allele; P<1×10(-122)) and was also associated with T2D risk (OR 0.69 [95%CI, 0.54-0.90]; P=0.006). Per 1-SD increase in log-transformed bilirubin levels, we observed a 25% (OR 0.75 [95%CI, 0.62-0.92]; P=0.004) lower risk of T2D. In Mendelian randomization analysis, the causal risk reduction for T2D was estimated to be 42% (causal ORIVestimation per 1-SD increase in log-transformed bilirubin 0.58 [95%CI, 0.39-0.84]; P=0.005), which was comparable to the observational estimate (Durbin-Wu-Hausman chi-square test Pfor difference =0.19). These novel results provide evidence that elevated bilirubin is causally associated with risk of T2D and support its role as a protective determinant.