Diabetes, a chronic metabolic disease, has become a serious health problem worldwide. According to the latest data from the International Diabetes Federation (IDF), there were 451 million DM patients worldwide in 2017, and would be expected to increase to 693 million by 2045. Therefore, there is a need to develop new drug-like molecules to combat this problem. Peroxisome proliferators-activated receptors (PPARs) are ligand-inducible nuclear receptors that control many intracellular metabolic processes. PPARγ agonists can improve metabolism and reduce the side effects caused by single drugs and have become a valuable drug target for designing effective drugs for the treatment of type 2 diabetes. In the present investigation, by the application of bioactivity score prediction, molecular docking, and ADMET prediction approach, the potential and selective phytoconstituents with the highest binding affinity, and lower toxicity than reference drug rosiglitazone was gained from the curated datasets of Allamanda cathartica. Further molecular dynamics simulations were carried out to identify the favourable binding conformations when the top-scored phytoconstituents bind with the PPARγ receptors compared to the rosiglitazone. Compound AC2 interacts with the PPARγ proteins through the formation of 7 hydrogen bonds with the amino acid residues Phe282, His449, Tyr327, His323 and Ser289. The ligand was bound to the protein during the simulation since none of the complexes conformations were unstable and no unfolding or folding took place. Our results provided an approach to further design and optimize the natural product-inspired small druglike molecules as potential antidiabetic agents. The present study highlighted that the phytoconstituents of Allamanda cathartica has antidiabetic potential as PPARγ agonists that can be further explored for novel antidiabetic drug development.