One of the new approaches to the management of type 2 diabetes mellitus (T2DM) consists of orally administered dipeptidyl peptidase-IV (DPP-IV) inhibitors. These synthetic drug inhibitors are reported to have some side effects and that subsequently limits their applications. There is a growing interest to develop natural DPP-IV inhibitors that will be potent without undesirable side effects. Many in vitro and some in vivo studies have highlighted the potential of food-derived peptides functioning as effective DPPIV inhibitors. Bioactive peptides within original food-derived proteins are inactive but can be activated by being released during food processing (by enzymatic hydrolysis or fermentation) or during gastrointestinal digestion. Hence, the utilization of computer-aided techniques as screening tools may be helpful in predicting the potential of food proteins as precursors of DPP-IV inhibitory peptides. This paper reviews the current literature on DPP-IV inhibitory peptides, focusing on their in vitro activity and in vivo antidiabetic effects. In addition, the feasibility of various in silico approaches is also summarized in this review.