Oxidative stress is caused by an imbalance between the production of reactive oxygen and an ability of a biological system, to readily detoxify the reactive intermediates or easily repair the resulting damage. It has been suggested that developmental alloxan-induced liver damage is mediated through increases in oxidative stress. The anti-diabetic effect and antioxidant activity of Phaleria macrocarpa (PM) fractions were investigated in alloxan-induced diabetic rats. After two weeks administration of PM, the liver antioxidant enzyme and hyperglycemic state were evaluated. The results showed that oral administration of PM treatments reduced blood glucose levels in diabetic rats by oral administration (P < 0.05). Serum glutamic-oxaloacetic transaminase (sGOT) and serum glutamic-pyruvate-transaminase (sGPT) were also diminished by PM supplementation. The superoxide dismutase (SOD), catalase (CAT) and glutathione-peroxidase (GPx) activities, and glutathione (GSH) level in the alloxan-induced diabetic rats were significantly decreased (P < 0.05) compared to those in the normal rats but were restored by PM treatments. PM fractions also repressed the level of malondialdehyde (MDA) in the liver. Glutathione reductase (GR), glutathione-S-transferase (GST) and $gamma$-glutamylcysteine synthase (GCS) were also reduced in alloxan-induced diabetic rats. PM fractions could restore the GR and GST activities, but the GCS activity was not affected in rat livers. From the results of the present study, the diabetic effect of the butanol fraction of PM against alloxan-induced diabetic rats was concluded to be mediated either by preventing the decline of hepatic antioxidant status or due to its indirect radical scavenging capacity.