In previous study, we have reported cycloart-23-ene-3β, 25-diol is an active antidiabetic constituent isolated from stem bark of Pongamia pinnata (Linn.) Pierre. The objective of the present investigation was to evaluate cycloart-23-ene-3β, 25-diol stimulates glucagon like peptide-1 (GLP-1) (7–36) amide secretion in streptozotocin–nicotinamide induced diabetic Sprague Dawley rats. Molecular docking studies were performed to elucidate the molecular basis for GLP-1 receptor agonistic activity. Type 2 diabetes was induced in overnight fasted Sprague Dawley rats pre-treated with nicotinamide (100mg/kg, i.p.) followed by administration of streptozotocin (55mg/kg, i.p.) 20min after. The rats were divided into following groups; I- non-diabetic, II- diabetic control, III- sitagliptin (5mg/kg, p.o.), IV- cycloart-23-ene-3β, 25-diol (1mg/kg, p.o.). The cycloart-23-ene-3β, 25-diol and sitagliptin treatment was 8 week. Plasma glucose was estimated every week (week 0 to week 8). Body weight, food and water intake were recorded daily. Glycosylated haemoglobin, lipid profile, plasma and colonic active (GLP-1) (7–36) amide, mRNA expression of proglucagnon GLP-1, plasma and pancreatic insulin, histology of pancreata as well as biomarkers of oxidative stress (superoxidase dismutase, reduced glutathione, malondialdehyde, glutathione peroxidase, glutathione S transferase) were measured after 8th week treatment. In acute study, active GLP-1 (7–36) amide release, plasma glucose and insulin were measured during oral glucose tolerance test. The docking data clearly indicated cycloart-23-ene-3β, 25-diol bind to the GLP-1 receptor. It decreased plasma glucose level, increased plasma and pancreatic insulin level as well as increased plasma and colonic active GLP-1 (7–36) amide secretion in streptozotocin–nicotinamide induced diabetic Sprague Dawley rats.