β-Sitosterol glucoside (SG), isolated from Senecio petasitis (Family Asteraceae), was loaded in self-nanoemulsifying drug delivery systems (SEDDS) in a trial to enhance its solubility and biological effect. Various co-surfactants were tested to prepare a successful SEDDS. The selected SG-loaded SEDDS had a droplet size of 134 ± 15.2 nm with a homogenous distribution (polydispersity index 0.296 ± 0.02). It also demonstrated a significant augmentation of SG in vitro release by 4-fold compared to the free drug suspension. The in vivo insulin sensitivity and antidiabetic effect of the prepared SG-loaded SEDDS were further assessed in streptozotocin-induced hyperglycemic rats. The hypoglycemic effect of SG-loaded nanosystem was evidenced by decreased serum glucose and insulin by 63.22% and 53.11%, respectively. Homeostasis model assessment-insulin resistance (HOMA-IR) index demonstrated a significant reduction by 5.4-fold in the diabetic group treated by SG-loaded nanosystem and exhibited reduced glucagon level by 40.85%. In addition, treatment with SG-loaded nanosystem significantly decreased serum MDA (malondialdehyde) and increased catalase levels by 38.31% and 64.45%, respectively. Histopathological investigations also supported the protective effect of SG-loaded nanosystem on the pancreas. The promising ability of SG-loaded nanosystem to ameliorate insulin resistance, protect against oxidative stress, and restore pancreatic β-cell secretory function warrants its inclusion in further studies during diabetes progression.