Cassia auriculata L. (Caesalpiniaceae) is widely used from the ancient period to treat diabetes mellitus. In the present study, the antioxidant activity of C. auriculata aqueous leaf extract (CLEt) was evaluated in streptozotocin-induced mild diabetic (MD) and severe diabetic (SD) rats. A short-term toxicity assessment was also conducted in healthy rats to examine toxic effects of the extract. Oral administration of CLEt to MD and SD rats (100, 200 and 400 mg/kg body weight per day for a period of 21 days) produced significant fall in fasting blood glucose (FBG) in a dose-dependent manner. Treatment with the extract (400 mg/kg) showed significant reduction in serum levels of thiobarbituric acid reactive substances (TBARS) and oxidized low-density lipoprotein (OxLDL) in both MD and SD rats. The antioxidant defense system was also found to be improved in CLEt-treated (400 mg/kg) MD and SD rats, as revealed by significant increase in activities of erythrocyte's antioxidant enzymes, i.e., superoxide dismutase (SOD) and catalase (CAT) with a concomitant elevation in erythrocyte's reduced glutathione (GSH) content. Moreover, there were no toxic signs in rats treated with high doses of the extract (1000 and 2000 mg/kg body weight per day for 21 days). Blood glucose, hepatic and renal function parameters in these rats were found within normal limits. Phytochemical screening of CLEt revealed the presence of alkaloids, flavonoids, saponins, tannins and cardiac glycosides with antihyperglycemic and antioxidant properties. This study suggests that CLEt possesses potent antioxidant activity along with antihyperglycemic potential, hence protective against diabetic complications.