This study was designed to investigate the anti-diabetic hypoglycaemic properties of an ethanolic extract of the root of Celosia argentea which is widely used in India as a traditional treatment for diabetes mellitus. An ethanolic extract of C. argentea root was found to lower blood glucose in basal conditions and after a heavy glucose load in normal rats. Maximum reduction in serum glucose was observed after 90 minutes at a dose of 500 mg/kg (63.28%) of body weight, but petroleum ether and chloroform extracts (8.52% and 9.81%, respectively) did not reduce the serum glucose. Ethanolic extract of C. argentea was also found to reduce the increase of blood sugar found in streptozotocin-induced diabetic rats (73.43% at 250 mg/kg and 80.20% at 500 mg/kg body weight on 15th day). Chronic administration of the extract significantly reduced the blood sugar in streptozotocin-induced diabetic rats for several days (15 days). The ethanolic extract was also found to reduce the increased levels of cholesterol, triglycerides and urea. The extract also restored the decreased level of proteins and liver glycogen in streptozotocin-induced diabetic animals and inhibited the body weight reduction induced by streptozotocin administration. These results indicate that C. argentea root extracts are able to ameliorate biochemical damages induced by streptozotocin in diabetic rats.