Type-2 diabetes mellitus (T2DM) is a chronic metabolic condition with more than 95% of the cases worldwide and can cause complications like retinopathy, nephropathy, cardiovascular problems, etc. Currently, major treatment protocols available for T2DM include oral hypoglycemic agents, insulin, and GLP-1 receptor agonists. Due to the unique mechanism of action, human glucagon-like peptide-1 (HuGLP-1) has been a focus for management of T2DM. Oral HuGLP-1 delivery is hindered by its hydrophilic nature, preventing intestinal absorption. Additionally, the unfavorable gut environment and hepatic metabolism significantly restrict its bioavailability. Sublingual administration offers a potential solution bypassing these obstacles. This route avoids first-pass metabolism and prevents enzymatic exposure of peptide thus enhancing its absorption. The goal of the present work is to design HuGLP-1 loaded hydrogel embedded with nanoliposomes that would protect it from systemic enzymes and extend the duration it spends in the bloodstream, improving its pharmacological activity. The particle size, polydispersity index, and entrapment efficiency of optimized HuGLP-1-NLs were found to be 179.2 ± 1.65 nm, 0.167 ± 0.01, and 47 ± 2.18%, respectively. Post sublingual delivery of HuGLP-1 NLs loaded hydrogel in T2DM induced SD rats, it showed significantly less reversal of hypoglycemia than the standard hydrogel (p < 0.001). In summary, extended sublingual administration of this formulation could boost T2DM management by improving patient compliance. This formulation could also be used for managing diabetes-related obesity and needs to be validated by preclinical testing on a large number of animal models.