Type 2 diabetes (T2D) is a prevalent metabolic disorder characterized by impaired insulin secretion and insulin resistance, resulting in elevated blood glucose levels. The dysfunction and loss of pancreatic β-cells, responsible for producing insulin, contribute to the development of T2D. Traditional Chinese medicine (TCM) has emerged as a potential source of innovative therapeutic interventions. However, limited research exists on Chinese herbal formulations specifically targeting the protection of pancreatic β-cell function and mass. One such formulation is the Shenqi compound (SQC), widely used in China and consisting of Panax Ginseng, Astragali Radix, Rhizoma Dioscoreae, Corni Fructus, Rehmanniae Radix, Salviae Miltiorrhizae Radix et Rhizoma, Radix Trichosanthis, and Rhei Radix et Rhizoma. Understanding the mechanisms underlying the therapeutic effects of SQC is crucial for developing novel treatment strategies for T2D. This study aims to comprehensively investigate the scientific evidence supporting the role of SQC in alleviating T2D by targeting the protection of pancreatic β-cell function and mass. Spontaneously diabetic GK rats were used as the animal model, receiving SQC (14.4 g/kg/d) for 8 weeks. The results demonstrate multiple beneficial effects of SQC, including significant control of blood glucose levels (P < 0.05), inhibition of insulin resistance (measured by Western Blot), reduction of hyperinsulinemia (P < 0.05), attenuation of oxidative stress (P < 0.05), suppression of inflammation (P < 0.05), protection against islet hypertrophy and beta cell proliferation (evaluated through pathological staining), and inhibition of β-cell apoptosis and senescence (also assessed through pathological staining). These findings indicate the promotion of β-cell survival and function. In vitro experiments using isolated islets further support these results, revealing improvements in insulin secretion (P < 0.05) and β-cell function following SQC therapy (P < 0.05). This represents a significant breakthrough in addressing β-cell dysfunction and preserving mass within the context of TCM. Overall, SQC shows promise as a natural therapeutic approach for T2D, with potential benefits in preserving pancreatic β-cell function and mass. This enhances the practical applicability and significance of the research by bridging the gap between experimental findings and clinical practice, thereby providing important clinical value in TCM treatment of T2D. Further research is necessary to elucidate its precise mechanisms of action and optimize its clinical application.