Osteoarthritis (OA) and osteoporosis (OP) are common among older women, especially postmenopausal women. Glucosamine (GlcN) is a common medication for OA, but it may induce insulin resistance and β-cell dysfunction, especially if ovarian hormones are lacking. Raloxifene (RLX) is a selective estrogen receptor modulator and also an OP drug. Previously, we found that estrogen could improve GlcN-induced insulin resistance in ovariectomized (OVX) rats. Here, we further hypothesized that RLX, similarly to estrogen, can ameliorate GlcN-induced insulin resistance in OVX rats. We used GlcN to induce insulin resistance in OVX rats as a model for evaluating the protective effects of RLX in vivo. We used a pancreatic β-cell line, MIN-6, to study the mechanisms underlying the effect of RLX in GlcN-induced β-cell dysfunction in vitro. Increases in fasting plasma glucose, insulin, and homeostasis model assessments of insulin resistance in OVX Sprague Dawley rats treated with GlcN were reversed by RLX treatment (n = 8 in each group). Skeletal muscle GLUT-4 increased, liver PEPCK decreased, pancreatic islet hypertrophy, and β-cell apoptosis in OVX rats treated with GlcN was ameliorated by RLX. The negative effects of GlcN on insulin secretion and cell viability in MIN-6 cells were related to the upregulation of reticulum (ER) stress-associated proteins (C/EBP homologous protein, phospho-extracellular signal-regulated kinase, phospho-c-JunN-terminal kinase), the expression of which was reduced by RLX. Pretreatment with estrogen receptor antagonists reversed the protective effects of RLX. GlcN can induce insulin resistance, β-cell dysfunction, and apoptosis in OVX rats and increase ER stress-related proteins in β-cells, whereas RLX can reverse these adverse effects. The effects of RLX act mainly through estrogen receptor α; therefore, RLX may be a candidate drug for postmenopausal women with OA and OP.