Significance Metformin is the most commonly prescribed drug for the treatment of type 2 diabetes mellitus, yet the mechanism by which it lowers plasma glucose concentrations has remained elusive. Most studies to date have attributed metformin’s glucose-lowering effects to inhibition of complex I activity. Contrary to this hypothesis, we show that inhibition of complex I activity in vitro and in vivo does not reduce plasma glucose concentrations or inhibit hepatic gluconeogenesis. We go on to show that metformin, and the related guanides/biguanides, phenformin and galegine, inhibit complex IV activity at clinically relevant concentrations, which, in turn, results in inhibition of glycerol-3-phosphate dehydrogenase activity, increased cytosolic redox, and selective inhibition of glycerol-derived hepatic gluconeogenesis both in vitro and in vivo.