Background: Diabetes Mellitus is a chronic metabolic disorder that is one of the major causes of morbidity and requires lifelong treatment. Aim and Objectives: This study was conducted to determine prescribing pattern and frequency of single and combination antidiabetic drugs prescribed for type 2 DM and to compare their percentage cost variation. Materials and Methods: This was a prospective observational study carried out among in-patients of the general medicine department of a tertiary care hospital for a period of 6 months. Results: A total of 246 subjects were analyzed showing the main age group was between 60-70 years (28.9%). Polypharmacy was evident in the study as 178 (72.4%) prescriptions had greater than 5 drugs. Metformin 500mg in 38 (33.04%), Metformin 500mg + Glimepiride 2mg in 36 (25.35%) subjects and Insulin soluble 30% + Isophane 70% were the most prescribed single, combination, and insulin preparation respectively. The highest percentage cost difference was seen with Vildagliptin 50 mg (72.88%) out of 15 single antidiabetic drugs, Metformin 500mg + Dapagliflozin 10mg (79.93%) out of 20 combination antidiabetic drugs and Insulin soluble 30% + Isophane 70% (28.28%) out of 6 insulin preparations. Conclusion: Oral dosage form was the most prescribed and there is inclination towards prescribing combination therapy. The study concluded that inclusion of generic drugs to the therapy will be economical for the patient, as it can reduce the wider price variation of antidiabetic drugs by different brands available in the hospital pharmacy.