This study evaluated the effect of selenium-enriched fermentation mycelia of C. comatus (SMCC) on reducing oxidative stress and hyperglycemia in alloxan-induced diabetic mice. After induction of diabetes, a significant increase of the levels of blood glucose and lipid peroxidation associated with the diminution of superoxide dismutase (SOD) and glutathione peroxidase (GSH-Px) was observed in all diabetic mice. Treatment of diabetic mice with SMCC for 21 days resulted in a significant reduction in blood glucose and the injuries of pancreas. In addition, a significant increase in the activities of SOD and GSH-Px and a significant decrease in the content of malondialdehyde (MDA) were observed in serum, liver and kidney. The results showed that SMCC might be able to inhibit hyperglycemia, and helpful in the prevention of diabetic complications associated with oxidative damage. It is concluded that SMCC possesses potent antioxidant activity, which may be directly or indirectly responsible for inhibiting hyperglycemia of alloxan-induced diabetic mice.