A rapidly increasing incidence of Diabetes mellitus throughout the world is a major concern in both developed and developing countries and the drawbacks associated with currently available treatments led to switching researcher’s attention towards naturopathy. Since ancient time, herbal plants have been traditionally used for the treatment of diabetes as they consider to be less toxic and free from side effects than synthetic ones. In our previous studies, we had isolated two new compounds (Methyl 5-tridecyloctadec-4-enoate and Nonacosan-8-one), together with three known compounds (Lupeol, β-sitosterol and Stigmasterol) from chloroform fraction of stem bark of P. cineraria (CfPc). The present study aimed to determine the in vivo and in vivo antidiabetic activity of CfPc in streptozotocin induced experimental diabetes and also evaluated their possible mode of action. CfPc was orally administrated to STZ (55 mg/kg b.wt) induced diabetic rats at the doses of 50 and 100 mg/kg b.wt for 21 days. Treatment of CfPc significantly (p < 0.05) lowered the level of blood glucose, glycosylated hemoglobin and also restored body weight, liver glycogen content and serum insulin level in diabetic rats in a dose-dependent manner. A significant (p < 0.05) reduction in serum lipid profile markers and elevation in HDL-C after treatment with CfPc, also signifying the protective effects of CfPc in diabetes-associated complications. In addition, CfPc also promoted a significant inhibition of α-amylase enzyme activity with an IC₅₀ value of 40.29 μg/ml. Results indicate that CfPc possess a potential in vitro and in vivo antidiabetic activity and this effect could be due to multitarget mode of action that includes antihyperglycemic, postprandial hypoglycemic, hypolipidemic and insulin secretory actions. Therefore, it could be used as a safer complementary drug in the management of diabetes and associated complications.