The main aim of present study is to formulate and evaluate bilayer tablets of Metformin Hydrochloride and Sitagliptin Phosphate as fixed dose combination tablets for effective treatment of type II diabetes mellitus. Here, an attempt was made to reduce the dose, dosage frequency, dose related gastrointestinal side effects of metformin and to improve its bioavailability which in turn improve the patient compliance. Preformulation studies including drug excipient compatibility were conducted for both drugs. Different formulations of sustained release, floating Metformin Hcl tablets were prepared by using hydrophilic polymers like HPMC K100 and Sodium CMC and were evaluated. Sitagliptin immediate release formulations were prepared using crosspovidone, croscarmellose sodium and sodium starch glycolate as superdisintegrants and were evaluated. Based on the in vitro dissolution data F7 and S9 were selected as the best formulations from Metformin and Sitagliptin formulations respectively. Bilayer tablets were prepared by slightly compressing Metformin layer (F7) and then final compression was made by placing Sitagliptin layer (S9) layer on it with final hardness 6.5 kg and they were evaluated. From the bilayer tablet Sitagliptin layer disintegrated in 52 sec, Metformin layer started floating after 5.2 min and gave total floating time 18-24 hrs with good swelling index, good post compression parameters. In vitro dissolution study of bilayer tablet was done in USP type II along with UV spectrophotometer gave cumulative % drug release of Sitagliptin as 99.15% at 30 min and 97.65 % of Metformin at 12 hrs. From the study, it was found that, combination of HPMC K100 and Sodium CMC gave good sustained release for 12 hrs. Among the 3 superdisintegrants used sodium starch glycolate showed good disintegration of sitagliptin layer.