Diospyros peregrina Gurke. (Ebenaceae) is a small middle sized tree grows luxuriantly in the plains of costal West Bengal, India. The objective of the study was to explore the antidiabetic activity of methanol extract of matured fruits of Diospyros peregrina to substantiate the folklore claim of traditional practitioners. It was also aimed to establish correlation with reduction of oxidative state associated with diabetes. Methanol extract of matured fruits of Diospyros peregrina was administered orally at doses of 150 and 300 mg/kg body weight for 12 consecutive days to normal and streptozotocin induced diabetic rats. Fasting blood glucose level was estimated in both normal and diabetic rats while serum lipid profiles, liver glycogen level and pancreatic thiobarbituric acid reactive substances (TBARS) were evaluated for diabetic rats. Initial and final changes in body weight were also recorded. Oral glucose tolerance test was performed during the course of study. Experimental findings showed significant antidiabetic potential of extract in term of reduction of fasting blood glucose level of both normal and diabetic rats. It was found that extract at the dose of 300 mg/kg body weight is more effective and percentage reduction (55.64) of elevated blood glucose level is comparable to that of standard drug glibenclamide (60.60) at a dose of 10 mg/kg body weight. Observed data found statistically significant in reduction of serum lipid and pancreatic TBARS levels whilst improvement was observed in liver glycogen level and body weight profiles in extract treated diabetic rats.