Background: Obesity and Type 2 Diabetes Mellitus (T2DM) presents a growing threat to the global health. Evidences highlight an important role of ghrelin as a key regulator of glucose metabolism. The physiological functions of ghrelin are mediated by enzyme ghrelin-O-acyltransferase (GOAT) which is capable of generating the active form of this metabolic hormone. However, its exact mechanism of action and influence on energy balance and glucose metabolism is yet to be explored. Objectives: To review the physiological role of GOAT in the regulation of energy balance and glucose metabolism and explore the potential therapeutic avenues of modulators of GOAT to counter the progression of obesity and T2DM. Methods: Publications were sought through electronic searches. The bibliographies of all papers, book, chapters and editorials were scanned and hand searches were also conducted for journals, and conference proceedings. Conclusion: GOAT peptide modulates the insulin secretion as well as insulin sensitivity. Modulators of GOAT signaling like inhibitors of GOAT increases insulin secretion, enhance peripheral insulin sensitivity and thus counters obesity and T2DM. Modulators of GOAT can be a probable therapy for modifying food intake and for countering obesity and T2DM.