Diabetes mellitus (DM), the third killer of the mankind health along with cancer, cardiovascular and cerebrovascular diseases, is one of the most challenging diseases facing health care professionals today. The World Health Organization (WHO) has declared that a DM epidemic is underway. Primary DM and its complications are costly to manage, not only for affected individuals, but also for healthcare systems around the world. Screening of anti-diabetic agents has been extensively investigated in the past decades. Natural products (NPs) have served as a major source of drugs for centuries, and about half of the pharmaceuticals in use today are derived from natural substances. Many natural products especially plants-derived medicines have been recommended for the treatment of DM. The present paper reviews NPs appeared in the literature with potential for DM and also identifies the research needs in this area. It mainly covers the time period from January 2004 to June 2009. The current review is divided into three major sections based on classification of the natural materials involved. The first part focuses on known and some new chemical entities isolated mainly from medicinal plants possessing anti-diabetic properties, including saponins, flavonoids, alkaloids, anthraquinones, terpenes, coumarins, phenolics, polysaccharides, and some other compounds. The second part summarizes crude extract of medicinal plants which are commonly used in the traditional Chinese medical system and have been demonstrated experimental or/and clinical anti-diabetic effectiveness, mainly including Leguminosae, Cucurbitaceae, Araliaceae, Liliaceae, Chenopodiaceae, Solanaceae, Compositae, Campanulaceae, Cornaceae, Rhamnaceae, Scrophulariaceae, Euphorbiaceae, Ginkgoceae, Gramineae, Myrtaceae, Sterculiaceae, Annonaceae, Labiatae, Crassulaceae, and Miscellaneous. The third part lists some compound formulae consisting of extracts of several plants that have been reported as beneficial for the treatment of DM, major involving Xiaokeling tablet, Huang-Lian-Jie-Du-Decoction, Ba- Wei-Di-Huang-Wan and Formula 1.