The present study was carried out to investigate the hypoglycemic effect of a polyherbal aqueous extract (Curcuma longa Linn., Emblica officinalis Gaertn., Trigonella foenum-graecum Linn., Enicostemma littorale Blume) in alloxan-induced diabetic rats. Short term experiments showed a decrease in blood glucose levels at $2^{nd};hr$ of administration of the aqueous extract in alloxan-induced diabetic rats with increase in serum insulin levels. The extract did not show any effect on blood glucose or serum insulin levels in normoglycaemic rats. Treatment with the extract (1.5 g dry plant equivalent extarct/100 g body weight/day) for 20 days in diabetic rats showed a significant decrease in blood glucose and glycosylated haemoglobin levels and an increase in serum insulin levels. The aqueous extract also showed an enhanced glucose-induced insulin release at 11.1 mM glucose from isolated rat pancreatic islets. The extract did not show any toxicity at the particular dose used.