Helichrysum graveolens (Bieb.) Sweet (Asteraceae) grows widely in Turkey. Capitulums of H. graveolens are used in the treatment of many diseases such as jaundice and wound healing and as a diuretic in the rural areas of Anatolia. The decoction from the capitulums of the plant is consumed for the symptoms of diabetes mellitus in folk medicine. In the present study, the hypoglycemic, antihyperglycemic, and antioxidant potentials of water and ethanol extracts of H. graveolens were evaluated by using in vivo methods in normal and streptozotocin-induced diabetic rats. Blood glucose levels of animals were measured by the glucose oxidase method. The antioxidant activity of these extracts was also studied in liver, kidney, and heart tissues. In order to determine antioxidant activity, tissue malondialdehyde and reduced glutathione levels were measured by using spectrophotometric methods. The experimental data obtained from water and ethanol extracts of capitulums confirmed the folkloric utilization. In order to discuss the role of polyphenolic components in the relevant activity, total phenol and flavonoid contents of each extract were also determined using the Folin-Ciocalteu reagent, and a positive correlation was observed.