Abstract: Diabetes mellitus is one of the widespread and severe metabolic disorders in humans all over the globe. Various medicinal plants have effectively been used to conquer this global health problem. Rhinacanthus nasutus is widely used in Thai medicine and various parts of the world to treat different diseases i.e., cancers, skin diseases, ringworm etc. The methanolic extract of R. nasutus was administered to streptozotocin induced (50 mg kg-1 b.wt.) diabetic male albino wistar rats for 30 days to identify its effect on serum and hepatic cholesterol levels. Oral administration of R.nasutus (200 mg kg-1 b.wt.) significantly decreased the serum total cholesterol, triglycerides, LDL-cholesterol and increased the HDL-cholesterol levels. The hepatic total cholesterol, triglycerides, phospholipids were also decreased after administration of R. nasutus in diabetic rats. The results of this experimental study indicate that R. nasutus possesses hypolipidemic activity without evident toxic effects to the experimental animal.