Under the guidance, which is still at a draft stage and needs to go through a consultation, around 750,000 more people with type 2 diabetes will be offered GLP-1 agonists such as semaglutide and liraglutide, which have become very popular as the drugs contained in weight-loss jabs.
Adults with cardiovascular disease and some who develop type 2 before they are 40 are the groups recommended to be offered them.
These drugs can be used both to lower blood sugar levels and to support some people with weight loss.
Prof Jonathan Benger, deputy chief executive and chief medical officer at NICE, said the updated guidance was "a significant evolution" in type 2 diabetes treatment which could help prevent heart attacks, strokes and other serious complications before they happen.
"This guidance means more people will be offered medicines, where it is right to do so, to reduce their future risk of ill health," he added.
The guidelines are part of a long-term plan by the NHS in England to reduce health inequalities and focus on preventing ill health in the first place.
The charity Diabetes UK said the announcement propelled type 2 diabetes treatments "into the 21st century".
"These guidelines could go a long way to easing the burden of living with this relentless condition, as well as helping to address inequities in type 2 diabetes treatments and outcomes," said Douglas Twenefour, head of clinical at the charity.