A solvent free three component condensation reaction between an aldehyde, ethyl acetoacetate and urea catalyzed by graphite, a green catalyst is described for the synthesis of dihydropyrimidin-2(1H)-ones. This protocol is scalable and the catalyst is reusable. This method is also applied for the synthesis of dihydropyrimidin-2(1H)-thiones. α-Amylase, a key enzyme in carbohydrate metabolism is generally targeted for management of type 2 diabetes. The therapeutic potential of the dihydropyrimidinones and dihydropyrimidinthiones to inhibit α-amylase activity was evaluated by in vitro assay. Of the synthesized compounds 3,4-dihydropyrimidin-2(1H)-thione (1k) demonstrated highest inhibition of α-amylase activity.