Cordyceps cicadae is a medicinal fungus used in treating night sweat, childhood convulsions, vision improvement and pain. This study was designed to evaluate the anti-diabetic activity of the crude polysaccharide (SHF) from the mycelium and body portion of C. cicadae. Diabetes mellitus was induced in the rat with a single intravenous injection of alloxan monohydrate (150 mg/kg). In other to evaluate the anti-diabetic effects of C. cicadae polysaccharide in alloxan-induced diabetic rats, the crude polysaccharide (SHF at 100, 200 and 400 mg/kg body weight) and glibenclamide were administered orally to diabetic rats for 30 days. Blood glucose level, total cholesterol (TC), triglyceride (TG), low density lipoprotein (LDL), high density lipoprotein (HDL), alanine transaminase (ALT), aspartate aminotransferase (AST), alkaline phosphate (ALP), creatinine (CREA), urea, malondialdehyde (MDA), superoxide dismutase (SOD), glutathione peroxidase (GSH) were determined. SHF showed significant reduction in blood glucose in diabetic rats. Treatment of diabetic rats also resulted an improvement in body weights, increased HDL, SOD and GSH, as well as decreased TC, TG, LDL, MDA, urea, CREA, ALT, AST and ALP. These results suggested that C. cicadae polysaccharide displayed anti-hyperglycemic, anti-hyperlipidemic and antioxidant activities and could be a promising therapeutic source in managing diabetes mellitus and its associated complications.