ObjectivesThe herbs in Tao Hong Si Wu Decoction (THSWD) are beneficial in the treatment of cognitive impairment. However, the underlying mechanisms of THSWD in treating diabetes‐associated cognitive dysfunction (DACD) are not entirely explored. This study is aimed to investigate the therapeutic effects of THSWD in DACD model rats and the underlying mechanism.MethodsUltra‐high‐phase liquid chromatography was employed to identify the main compounds contained in the THSWD extract. DACD rat model was induced by feeding with a high‐sugar and high‐fat diet and injecting streptozotocin (35 mg/kg). DACD rats were gavaged with THSWD for 1 week. The learning and memory abilities of the rats were measured by using the Morris water maze. Western blotting was used to detect the changes in DACD rat targets. Statistical methods were used to evaluate the correlation between proteins.ResultsThe results show that THSWD effectively reduced the escape latency, hippocampal neuron damage, glycosylated hemoglobin, type A1C, and blood lipid levels in DACD rats. Furthermore, DACD rats showed significantly increased amyloid precursor protein, β‐secretase, Aβ1−40, Aβ1−42, Tau phosphorylation, and advanced glycation end products (AGEs) expression. However, THSWD treatment can reverse this phenomenon.ConclusionsTHSWD can improve the learning and memory abilities of DACD rats by inhibiting the expression of AEGs‐AGE receptors pathway, which provides an experimental basis for the clinical application of THSWD. In addition, the experiment combines pharmacological and statistical methods, which offers a new perspective for the study of Chinese herbal medicine.