This study will assess safety, tolerability, and effect of LIK066 on blood glucose in healthy subjects and in patients with T2DM.

Inclusion Criteria:

• Parts I and III: Healthy male and female subjects age 18 to 55 years of age included, and in good health as determined by past medical history, physical examination, electrocardiogram, and laboratory tests at screening.
• Parts II and IV: Patients, age 18-65 years, must have been diagnosed with T2DM at least 8 weeks prior to screening with HbA1c 6.5 to 10.0%, inclusive, at screening.
• Fasting plasma glucose ≤250mg/dL at screening and baseline.
• If treated with metformin, patients must be on a stable dose for 12 weeks prior to randomization and maintain the dose until the end of the study.

Exclusion Criteria; all parts:

• Patients with type 1 diabetes mellitus.
• Patients with history of acute diabetic complications within the 6 months prior to screening.
• Women of child-bearing potential.
• Patients with signs or symptoms of significant diabetic complications.
• Patients treated with certain blood pressure or lipid lowering medications unless patients have been on stable doses for the 12 weeks prior to dosing.
• History of drug or alcohol abuse within the 12 months prior to dosing.
• Any surgical or medical condition, acute or unstable chronic disease which may, based on the investigator's opinion, jeopardize the patient in case of participation in the study.

Other protocol-defined inclusion/exclusion criteria may apply