Rheum palmatum Linn has been widely applied in the clinical treatment of diabetes mellitus. It has been found that emodin as the major bioactive component of R. palmatum L exhibits the competency to activate peroxisomal proliferator-activated receptor-gamma (PPARgamma) in vitro. So the aim of this study was to evaluate the anti-diabetic effects of emodin through the activation of PPARgamma on high-fat diet-fed and low dose of streptozotocin (STZ)-induced diabetic mice. The diabetic mice were intraperitoneally injected with emodin for three weeks. No changes of food consumption and the body weight in emodin-treated mice were monitored daily during the entire experiment. At the end of experiment, the levels of blood glucose, triglyceride and total cholesterol in serum were significantly decreased after emodin treatment. However, serum high-density lipoprotein cholesterol (HDLc) concentration was significantly elevated. The glucose tolerance and insulin sensitivity in emodin-treated group were significantly improved. Furthermore, the results of quantitative RT-PCR analysis showed that emodin significantly elevated the mRNA expression level of PPARgamma and regulated the mRNA expressions of LPL, FAT/CD36, resistin and FABPs (ap2) in liver and adipocyte tissues. No effects on the mRNA expressions of PPARalpha and PPARalpha-target genes were observed. Taken together, the results suggested that the activation of PPARgamma and the modulation of metabolism-related genes were likely involved in the anti-diabetic effects of emodin.