Inclusion Criteria:

• Potential participants will be those with T2DM, with a diagnosis of diabetes of at least one year in duration,
• BMI 30-42 kg/m2 for the LAGB compared to intensive medical weight and diabetes management and BMI 30-42 kg/m2 for LRYGB compared to intensive medical weight and diabetes management,
• Age 21-60 years,
• With a strong desire for substantial weight loss, who are free from active cardiovascular or other diseases that would render them unable to partake in a structured exercise program or to undergo a bariatric surgical procedure, and who are committed to life long medical and nutritional follow up.

Exclusion Criteria:

• Detectable levels of GAD antibody or a history of diabetic ketoacidosis or uncontrolled T2DM (consistent fasting blood glucose >200 mg/dl or HbA1c above twice normal);
• Previous gastrointestinal surgery, inflammatory bowel disease, esophageal diseases including severe intractable esophagitis, Barrett's Disease, esophageal dysmotility or other impaired gastric motility (gastroparesis), or hiatal hernia >3 cm in size, chronic or acute bleeding conditions including peptic ulcer disease, portal hypertension (gastric or esophageal varices), chronic pancreatitis, or cirrhosis of the liver;
• Malignant or debilitating medical conditions, severe cardiopulmonary disease including uncontrolled hypertension (repeated systolic measures >160 or diastolic > 95 mm Hg on more than one day), unstable angina pectoris, recent myocardial infarction within 6 months, history of coronary artery bypass surgery or angioplasty, congestive heart failure, arrhythmia, stroke or transient ischemic attacks, urinary albumin excretion >300 mcg/mg creatinine and/or serum creatinine >1.5 mg/dL (permitting safety of increased dietary protein intake),
• Any endocrine disorder other than T2DM or thyroid disease which is stable on replacement therapy, including Cushing's syndrome;
• Any previous history of eating disorders, history of drug and/or alcohol abuse within 2 years of the screening visit, history of impaired mental status by DSM-IV (Diagnostic and Statistical Manual, 4th Edition) criteria and including, but not limited to active substance abuse, a history of schizophrenia, borderline personality disorder, uncontrolled depression, suicidal attempts within the past two years or current suicidal tendencies or ideations.
• Subjects will be excluded if there is a history of significant weight loss (>3%) within the previous 3 months or participation in alternate medically supervised exercise or weight reduction program within the previous 3 months, or with use of prescription or over the counter weight reduction medications or supplements within one month of the Screening Visit and for the duration of study participation.
• Women who are lactating, planning pregnancy, or unwilling to use contraception during the course of the trial.