Bioconversion of biosynthetic heterocyclic compounds has been utilized to produce new semisynthetic pharmaceuticals and study the metabolites of bioactive drugs used systemically. In this investigation, the biotransformation of natural heterocyclic alkaloid papaverine via filamentous fungi was explored. Molecular docking simulations, using protein tyrosine phosphatase 1B (PTP1B), α-glucosidase and pancreatic lipase (PL) as target enzymes, were performed to investigate the antidiabetic potential of papaverine and its metabolites in silico. The metabolites were isolated from biotransformation of papaverine with Cunninghamella elegans NRRL 2310, Rhodotorula rubra NRRL y1592, Penicillium chrysogeneum ATCC 10002 and Cunninghamella blackesleeana NRRL 1369 via reduction, demethylation, N-oxidation, oxidation and hydroxylation reactions. Seven metabolites were isolated: namely, 3,4-dihydropapaverine (metabolite 1), papaveroline (metabolite 2), 7-demethyl papaverine (metabolite 3), 6,4′-didemethyl papaverine (metabolite 4), papaverine-3-ol (metabolite 5), papaverinol (metabolite 6) and papaverinol N-oxide (metabolite 7). The structural elucidation of the metabolites was investigated with 1D and 2D NMR and mass spectroscopy (EI and ESI). The molecular docking studies showed that metabolite 7 exhibited better binding interactions with the target enzymes PTP1B, α-glucosidase and PL than did papaverine. Furthermore, papaverinol-N-oxide (7) also displayed inhibition of α-glucosidase and lipase enzymes comparable to that of their ligands (acarbose and orlistat, respectively), as unveiled with an in silico ADMET profile, molecular docking and molecular dynamics studies. In conclusion, this study provides evidence for enhanced inhibition of PTP1B, α-glucosidase and PL via some papaverine fungal transformation products and, therefore, potentially better antidiabetic and antiobesity effects than those of papaverine and other known therapeutic agents.