Diabetic kidney disease affects approximately one‐third of diabetes patients. Hyperglycemia and oxidative stress contribute to this condition. Boswellia serrata gum resin is known for its antioxidant properties and potential in managing diabetic complications, though its nephroprotective effects are not well documented. This research aimed to determine the phytochemical constituents of B. serrata using LC‐MS analysis and explore its benefits in enhancing hematological markers and improving STZ‐induced renal dysfunction in rats. Diabetes was induced by a single dose of streptozotocin (60 mg/kg). 40 male albino Wistar rats were divided into four groups: normal control, control with B. serrata (2% w/w), and two diabetic groups. One diabetic group served as a positive control, while the other received B. serrata powder (2% w/w). Results showed that the powder reduced blood sugar, decreased renal markers, increased albumin, total protein and restored hematological parameters. It also enhanced β cell function (HOMA‐β) and prevented kidney structural abnormalities. Additionally, B. serrata reduced oxidative stress by lowering malondialdehyde (MDA) and increasing glutathione (GSH), glutathione‐S‐transferase (GST), catalase (CAT), and glutathione peroxidase (GPx) in renal tissues. LC‐MS identified 37 phenolic compounds, with apigetrin being the most abundant. These findings suggest that B. serrata holds promise for managing diabetes‐related kidney injury.