Diabetes-induced damages in brain are known as diabetic encephalopathy, which is well characterized by cellular, molecular and functional changes in the brain of diabetic subjects and rodents. However, little is known about the mechanism of damages and the therapeutic strategies in ameliorating those damages in the diabetic brain. In this study, we utilized a flavonoid, morin which is emerging as a potent drug against a wide range of free radical-mediated as well as neurodegenerative diseases. Morin (15 and 30 mg/kg body weight/day) was orally administered to two different groups of rats after 1 week of diabetes induction, and continued for five consecutive weeks. Two other untreated groups of diabetic and non-diabetic rats were used to compare with drug-treated groups. After drug treatments, cerebral cortex of the brain harvested and analyzed for different factors. Morin supplementation especially at high dose increased the levels of insulin, reduced glutathione, superoxide dismutase and catalase activities, and decreased fasting glucose and thiobarbituric acid reactive substances in the diabetic brain compared to untreated diabetic rats (P < 0.05). Morin also significantly decreased the level of inflammatory markers (TNFα, IL1β, IL-6) in the diabetic brain compared to untreated diabetic rats. Furthermore, the drug influenced an increase in the level of neurotrophic factors (BDNF, NGF and IGF-1) in the diabetic brain compared to untreated diabetic rats (P < 0.05). Thus, our results indicate a beneficial effect of morin by decreasing oxidative stress, inflammation and increasing the neurotrophic support in the diabetic brain, which may ameliorate diabetic encephalopathy.