Objective To investigate the potential molecular mechanism of Danzhi Jiangtang Capsule in the treatment of diabetes based on network pharmacology. Methods Traditional Chinese Medicine Systems Pharmacology and Swiss Target Prediction database were used to search for the chemical components, corresponding targets, and target genes of Danzhi Jiangtang Capsule. GeneCards was used to obtain the targets of diabetes, and a Venn diagram was plotted for the targets of active components and the targets of diabetes to search for intersecting targets and obtain the predictive targets of Danzhi Jiangtang Capsule in the treatment of diabetes. Cytoscape 3.7.2 software was used to construct a medicinal material-compound-target (gene) network and screen out key compounds, and STRING website was used to establish a protein-protein (PPI) network of intersecting targets and screen out key target genes. R software was used to perform GO analysis and KEGG pathway enrichment analysis of common targets. Results In Danzhi Jiangtang Capsule, there were 25 active components acting on diabetes, with 76 related target genes. GO and KEGG analyses showed that 1702 biological processes and 149 signaling pathways were involved in the mechanism of action of Danzhi Jiangtang Capsule in the treatment of diabetes. Conclusion The key components of Danzhi Jiangtang Capsule, such as quercetin, luteolin, and kaempferol, can exert a therapeutic effect on diabetes by regulating the AGE-RAGE, IL-17, TNF, HIF-1, and other signaling pathways, and its mechanism of action may be associated with anti-inflammation, reduction of oxidative stress level, and participation in cell apoptosis and injury.