A novel gastric ulcer healing formulation, a mixture of Dioscoreae Rhizoma, Halloysitum Rubrum and Ostreae Testa (Dihaos), was examined for gastric ulcer healing effects. The effect of Dihaos was assessed in various gastric ulcer models in rats. Oral administration of Dihaos significantly reduced HCl-ethanol-induced gastric ulcers. Dihaos also significantly reduced gastric and duodenal ulcers induced by cysteamine. Ostreae Testa decreased secretion of gastric juice and increased the pH of gastric juice. Furthermore, the extracts of Dioscoreae Rhizoma affected the cell proliferation of MKN 74 cells. These results suggest that the healing effect of Dihaos on gastrohemorrhagic lesions results from its protective effect against acid secretion and proliferation of mucosal cells in induced gastric ulcers in rats.