A single i.v. dose of streptozotocin (65 mg/kg) given to rats has produced a marked hyper-glycemia (>500 mg serum glucose/dl). Since the Atractylodis Rhizoma is known to have hypo-glycemic action, the water extracts of Atractylodis Rhizoma (ARWE) was given to the streptozotocin-induced (SZ) hyperglycemic rats. To determine whether ARWE has the anti-hyperglycemic effects, two different daily doses of ARWE (i.e.0.2 g/kg and 2.0 g/kg) were given orally to the SZ rats for up to 8 days. Thereupon, serum levels of glucose, insulin, amylase and cholesterol were determined on days 1, 3 and 8, following the initial and repeated daily administrations of ARWE. On day 8, glycogen content and glucose-6-phosphatase activity in the liver were assayed. Results showed that ARWE decreased the serum glucose levels, which had been markedly elevated by the SZ pre-treatment. In support of this, the serum insulin level, which had been quickly lowered by the SZ pre-treatment (20μU/ml), was quickly elevated in the ARWE dose dependent manner that, at 2.0 g/kg ARWE, the serum insulin level was increased (20μU/ml) above the normal level (42μU/ml). Also, the serum amylase level, which was steadily decreasing after the SZ pre-treatment, was restored to the normal level folowing 8 day of ARWE (2.0 g/kg) treatment. Hepatic glycogen content and glucose-6-phosphatase activity, which decreased and increased, respectively in the 52 treatment group, were restored toward the normal level in SZ plus ARWE group.