Diabetes is usually associated with inflammation. Inflammation contributes to the development of diabetes. Traditional Chinese medicines (TCM) play an important role in lowering blood glucose and controlling inflammation. Many studies show that TCM with hypoglycaemic effects, for example Radix Astragali, Radix Rehmanniae, Radix Trichosanthis, Panax Ginseng, Fructus Schisandrae, Radix Ophiopogonis, Rhizoma Anemarrhenae, Radix Puerariae, Fructus Lycii, Poria, Rhizoma Coptidis, Rhizoma Dioscoreae, Rhizoma Polygonati, Radix Salviae Miltiorrhizae, Radix Glycyrrhizae, Semen Trigonellae, Momordica charantia, Allium sativum, Opuntia stricta, Aloe vera, Cortex Cinnamomi, Rhizoma Curcumae Longae, and so on, have nearly independent anti-inflammatory action. Antihyperglycaemic compounds, for example berberine, puerarin, quercetin, ferulic acid, astragaloside IV, curcumin, epigallocatechin gallate, resveratrol, tetrandrine, glycyrrhizin, emodin and baicalin, used in TCM also have anti-inflammatory effects. These studies suggest that TCM might exert hypoglycaemic effects that are partly mediated by the anti-inflammatory mechanisms. However, small amounts of TCM with potent anti-inflammatory action does not have any hypoglycaemic effect. This indirectly indicates that diabetes may be a low-grade inflammatory disease and potent regulation of inflammatory mediators may not be required. Studies of TCM add new evidences, which indicate that diabetes may be an inflammatory disease and slight or moderate inhibition of inflammation might be useful to prevent the development of diabetes. Through this review, we aim to develop more perspectives to indicate that diabetes may be an inflammatory disease and diverse TCM may share a common antidiabetic property: anti-inflammatory action. Further studies should focus on and validate inflammation-regulating targets of TCM that may be involved in inhibiting the development of diabetes.