The morbidity and mortality associated with type 2 diabetes mellitus (T2DM) have grown exponentially over the last 30 years. Together with its associated complications, the mortality rates have increased. One important complication in those living with T2DM is the acceleration of age‐related cognitive decline. T2DM‐induced cognitive impairment seriously affects memory, executive function, and quality of life. However, there is a lack of effective treatment for both diabetes and cognitive decline. Thus, finding novel treatments which are cheap, effective in both diabetes and cognitive impairment, are easily accessible, are needed to reduce impact on patients with diabetes and health‐care systems. Carnosine, a histidine containing dipeptide, plays a protective role in cognitive diseases due to its antioxidant, anti‐inflammation, and anti‐glycation properties, all of which may slow the development of neurodegenerative diseases and ischemic injury. Furthermore, carnosine is also involved in regulating glucose and insulin in diabetes. Herein, we discuss the neuroprotective role of carnosine and its mechanisms in T2DM‐induced cognitive impairment, which may provide a theoretical basis and evidence base to evaluate whether carnosine has therapeutic effects in alleviating cognitive dysfunction in T2DM patients.