Homeostatic mechanisms that maintain blood glucose concentration within a narrow physiologic range are complex and redundant. Elaborate feedback loops involving insulin, glucagon, sympathoadrenal mediators, growth hormone, amylin, and incretins normally operate synchronously to keep blood glucose within a narrow set point. Individuals with diabetes have defects in glucose homeostatic pathways, including the counterregulatory pathways that oppose hypoglycemia and ensure sufficient glucose is available to serve the brain's metabolic needs. Because available interventions to manage hyperglycemia do not precisely mimic physiologic insulin secretion patterns, hypoglycemia can occur any time dosing exceeds demand. Focusing on the practical implications, we review the endocrinological principles underlying normal glucose homeostasis and the defects in regulation and counterregulation, including hypoglycemia unawareness, that occur with diabetes. Iatrogenic and behavioral factors that contribute to hypoglycemia risk and nocturnal hypoglycemia are discussed. A companion manuscript reviews the clinical symptoms and fundamentals of hypoglycemia prevention, recognition, and management.