Diabetes mellitus (DM) is not one disease but is a heterogonous group of syndromes. Contrary to the popular belief DM is a metabolic disorder characterized by increased blood glucose level (hyperglycemia) and this is because of insufficient or inefficient insulin secretary response. Glucose is the main energy source for the body, and in the case of DM, management of glucose becomes irregular. There are around 410 experimentally proven medicinal plants having antidiabetic properties but the complete mechanism of action is available only for about 109. There are several medicinal plants whose extract modulate glycolysis, Krebs cycle, gluconeogenesis, HMP shunt pathway, glycogen synthesis and their degradation, cholesterol synthesis, metabolism and absorption of carbohydrates, and synthesis and release of insulin. This paper provides a comprehensive review of the mode of action of medicinal plants that exhibit anti-diabetic properties. © 2008 Bentham Science Publishers Ltd.