To determine, in subjects with Type 2 Diabetes Mellitus:

1. Whether glycemic control can be achieved at least as effectively with an insulin regimen involving pre-meal EXUBERA™ (inhaled insulin) plus a single bedtime Ultralente injection as with a conventional subcutaneous insulin regimen involving 2 mixed Regular/NPH insulin injections per day.
2. The toleration and safety of EXUBERA™ (inhaled insulin) therapy and its effects after 6 months, if any, on measures of pulmonary function.

Inclusion Criteria:

• Type 2 Diabetes
• Stable insulin regimen of at least 2 injections per day

Exclusion Criteria:

• Any smoking within the last 6 months. Smoking is not permitted at any time during this study.
• Subjects on insulin pump during 2 months prior to screening.
• Subjects with poorly-controlled asthma, clinically significant chronic obstructive pulmonary disease, or other significant respiratory disease.