Diabetic peripheral neuropathy (DPN) is a significant and frequent complication of diabetes. Bu‐Yang‐Huan‐Wu Decoction (BHD) is a classic traditional Chinese herbal prescription that is commonly used in modern clinical practice for the effective treatment of DPN , but the underlying mechanism is not yet clearly defined. The chemical constituents of BHD were characterized by UPLC‐Q‐Orbitrap HR MS/MS, and a total of 101 chemical components were identified, including 30 components absorbed into blood. An interaction network of "compound‐target‐disease" interactions was constructed based on the compounds detected absorbed in blood and their corresponding targets of diabetic neuropathy acquired from disease gene databases, and the possible biological targets and potential signalling pathways of BHD were predicted via network pharmacology analysis. Subsequently, methylglyoxal‐induced (MGO‐induced) Schwann cells (SCs) were used to identify the active ingredients in blood components of BHD and verify the molecular mechanisms of BHD. Through network topological analysis, 30 shared targets strongly implicated in the anti‐DPN effects of BHD were identifed. Combined network pharmacology and in vitro cellular analysis, we found that the active ingredient of BHD may treat DPN by modulating the AGEs/RAGE pathway. This study provides valuable evidence for future mechanistic studies and potential therapeutic applications for patients with DPN.