Eugenia jambolana (EJ) is an Indian traditional herb widely used for the treatment of diabetes mellitus. This herb is globally marketed as single or multi herb formulations. Many diabetes patients consume EJ extract oral hypoglycemic drugs together. This calls for a need to assess risks versus benefit of this co-administration. In present investigation, pharmacodynamic and pharmacokinetic interactions of aqueous extract of EJ seeds at the dose of 400 mg/kg are studied with 10 mg/kg of oral hypoglycaemic drug sitagliptin (SITA) by co-administrating them for 28 days in streptozotocin (STZ) induced diabetic rats. The pharmacokinetic parameters of SITA were determined using HPLC-ESI-MS/MS and it was found that the combination treatment reduces the systemic exposure of SITA by showing 38.70% reduction in concentration maximum (Cmax) and 22.40% reduction in area under curve (AUC). Despite low levels of SITA, the combination demonstrated a significant reduction in blood glucose level when compared with individual drug and individual extract administered groups during pharmacodynamic study. In addition, the liver function, the kidney function and the lipid parameters were found to be significantly improved and beneficial effects were found with respect to food intake and water intake and urine output in case of combination treatment groups when compared with individual treatment groups. Histopathological examination of pancreatic tissue suggests its significant recovery of having normal acinus with better cell protection in combination treatment. In conclusion, the combination treatment demonstrated reduced systemic exposure of SITA without compromising on its antihyperglycemic activity and improvement in conditions associated with diabetes.