Effect of bischalcone derivative (2E,5E)-2,5 bis(4-hydroxy-3-methoxybenzylidene) cyclopentanone (CA) on blood glucose level and lipid profile was investigated in normoglycemic and streptozotocin (STZ)-induced diabetic rats. In oral glucose and sucrose tolerance test, treatment with CA (25 mg/kg) and glidenclamide (10 mg/kg) significantly improved the glucose and sucrose tolerance in normal animals. In addition, respective treatment for 7-day resulted in significant percentage reduction in serum glucose (SG). In standardized STZ-induced diabetic rats, a single dose of CA treatment exhibited reduction in SG levels at different time intervals compared to basal levels. The lipid profile levels are restored to near-normal value of all tested parameters. The compound CA was docked into the active site of 50 -AMP (adenosine monophosphate) activated protein kinase (PDB ID: 2OOX). The binding and docking energy were found to be -6.9 and -45.1 kcal/mol, respectively.