Type 2 diabetes mellitus (T2DM) is a systemic metabolic disorder characterized by insulin deficiency and insulin resistance. Recently, it has become a significant threat to public health. Polygonatum sibiricum saponin (PSS) has potential hypoglycemic effects, but its specific mechanism needs further study. In this study, PSS significantly decreased the level of blood glucose, water intake, and the organ index in diabetic mice. Meanwhile, PSS effectively reduced the content of total triglyceride (TG), total cholesterol (TCHO), low-density lipoprotein cholesterol (LDL-C), alanine aminotransferase (ALT), and aspartate aminotransferase (AST) in the blood, and increased the content of high-density lipoprotein cholesterol (HDL-C). This suggests that PSS could reduce the content of blood lipids and initially improve the damage of hepatocytes. We found that PSS alleviated hepatic insulin resistance, repaired islet beta cells, and enabled insulin to play its biological role normally. It also improved oral glucose tolerance and abated serum lipopolysaccharide (LPS) and glycosylated hemoglobin (HbA1c) levels in T2DM mice. Furthermore, studies have found that PSS increased the content of phosphorylated protein kinase B (AKT), thereby promoting the effect of glucose transporter 4 (GLUT-4), and activating glycogen synthase kinase 3beta (GSK-3β) and glycogen synthase (GS) proteins to promote hepatic glycogen synthesis. Finally, we found that PSS could promote the growth of beneficial bacteria such as Bifidobacterium and Lactobacillus, reduce the growth of harmful bacteria such as Enterococcus and Enterobacter, and preliminarily improve the composition of important bacteria in the intestine. These studies indicate that PSS has an excellent hypoglycemic effect, which provides a potential new treatment for T2DM and guidance for more in-depth research.