Type 2 diabetes mellitus (T2DM) is a common metabolic disease accompanied by cognitive impairment, hippocampal malfunctioning, and inflammation. Biobran/MGN-3, an arabinoxylan rice bran, has been shown to have an antidiabetic effect in streptozotocin-induced diabetic rats. The present study investigates Biobran’s effect against diabetes-induced cognitive impairment and synaptotoxicity in the hippocampus via oxidative stress and the IR/A/NF-κB signaling pathway in rats. Diabetes was induced via i.p. injection of streptozotocin (STZ) (40 mg/kg BW); STZ-treated rats were then administered Biobran (100 mg/kg BW) for 4 wks. Biobran supplementation improved motor coordination and muscular strength, as assessed by Kondziella’s inverted screen test. Biobran also improved concentration levels of glutathione (GSH), antioxidant enzymes, acetylcholine (ACh), dopamine, serotonin, insulin receptor (IR), and alpha serine-threonine protein kinase (Akt); it protected against elevated levels of glucose, total cholesterol, triglycerides, oxidative stress markers, TBARS, NO, AChE, and MAO; and it significantly decreased inflammatory cytokines levels of IL-1β, NF-κB, TNF-α, and amyloid β1-42. Moreover, Biobran ameliorated hippocampal histological alterations. Immunohistochemical observations showed that Biobran reduced overexpression of hippocampal synaptophysin and Ki67 relative to untreated diabetic rats. Biobran may ameliorate hippocampal alterations in diabetic rats via its antidiabetic, antiproliferative, anti-inflammatory, antiapoptotic, and antioxidant effects.