Abstract： Objective： To observe the curative effect of Yangyin Yunjin Prescription combined with routine therapy on type 2 diabetes mellitus （T2DM） complicated with non-alcoholic fatty liver disease （NAFLD） and its effects on glucose and lipid metabolism. Methods：A total of 110 cases of patients with T2DM complicated with NAFLD with deficiency of both qi and yin syndrome，treated at Anyang Hospital of Chinese Medicine from January 2022 to January 2023， were divided into the control group and the observation group according to the random number table method， with 55 cases in each group. During the study， three cases from the control group and one case from the observation group were excluded，resulting in 52 cases in the control group and 54 cases in the observation group. The control group was given routine modern medical treatment， and the observation group was additionally treated with Yangyin Yunjin Prescription based on the treatment of the control group. Changes in traditional Chinese medicine syndrome scores， glucose and lipid metabolism levels， liver function levels， and NAFLD ultrasound grading in the two groups were compared before and after treatment； the incidence of adverse reactions were compared between the two groups. Results：After one and three months of treatment，traditional Chinese medicine syndrome scores for mental fatigue， lack of strength， thirst and polydipsia， and shortness of breath， and spontaneous sweating in the two groups were decreased when compared with those before treatment （P＜0.05），with the observation group showing lower scores than the control group at the same time points （P＜0.05）. After one and three months of treatment，the levels of fasting blood glucose， two-hour postprandial blood glucose， and glycated hemoglobin in the two groups were reduced when compared with those before treatment （P＜0.05）， with the observation group showing lower levels than the control group （P＜0.05）. After one and three months of treatment，the levels of triglyceride and cholesterol in the two groups were decreased when compared with those before treatment， and high-density lipoprotein cholesterol levels were increased when compared with those before treatment，differences being significant （P＜0.05）；the observation group had lower levels of triglyceride and cholesterol and higher high-density lipoprotein cholesterol level than the control group， with significant differences （P＜0.05）. After one and three months of treatment， the levels of aspartate transaminase， alanine transaminase， and glutamyltransferase in the two groups were reduced when compared with those before treatment （P＜0.05），with the observation group showing lower levels than the control group at the same time points （P＜0.05）. After three months of treatment， the proportion of severe NAFLD ultrasound grading was decreased and the proportion of mild NAFLD ultrasound grading was increased in the two groups，when compared with that before treatment，After treatment, the proportion of mild NAFLD ultrasound grading in the observation group was higher than that in the control group, and the proportion of severe NAFLD grading was lower than that in the control group （P＜0.05）. The incidence of adverse reactions was 5.77% （3/52） in the control group and 9.26% （5/54） in the observation group，with no significant difference between the two groups （P＞0.05）. Conclusion：Yangyin Yunjin Prescription combined with routine therapy for T2DM complicated with NAFLD can effectively control clinical conditions，improve glucose and lipid metabolism，protect liver function and reduce hepatic steatosis，with good safety.