Although polysaccharide is believed to play an important role in the medicinal effect of Dendrobium chrysotoxum Lindl (DCL), its role as an antioxidant and in anti-hyperglycemic induction was not reported. In this study, polysaccharide with molecular weight of approximately 150 kDa, herein named DCLP, was isolated from the stem of DCL, and its antioxidative, hypoglycemic and immune stimulating effects were evaluated using various in vitro and in vivo assay systems. DCLP inhibited hydroxyl radicals ($^{cdot}$OH)-mediated deoxyribose degradation by scavenging hydroxyl radicals directly as well as by chelating iron ions. DCLP also showed dose-dependent scavenging activity on superoxide anions ($O_2^{{cdot}-}$) and offered significant protection (p < 0.001) against glucose oxidase-mediated cytotoxicity in Jurkat cells. DCLP had immune stimulating effects, as evidenced by the DCLP-mediated increases in the level of DNA synthesis, viability, and cytokine secretion in mouse lymphocytes. Moreover, oral administration of DCLP produced a significant reduction in blood glucose level in alloxan-induced diabetic mice. These findings suggest that DCLP has a potential utility in treating patients who require enhanced antioxidation, immune function and/or hypoglycemic activity.