Berberine (BER), a natural product and active ingredient of genera Berberis and Coptis, has been demonstrated to possess anti-diabetic activities. However, the poor bioavailability of this agent greatly limits its clinical application. In our previous study, we demonstrated that co-administration of sodium caprate, an absorption enhancer, with BER could significantly increase the bioavailability of BER without any serious mucosal damage. Here, we investigated the effects of BER on AMP-activated protein kinase (AMPK)/gluconeogenesis pathway and the effects of sodium caprate on hypoglycemic action of BER. The ability of BER co-administered with sodium caprate to reduce insulin resistance was investigated in diabetic rat model induced by high-fat diet and low dose STZ. Western blot was performed to evaluate effects of BER on AMPK signaling proteins involved in hepatic gluconeogenesis in diabetic rat and HepG2 hepatocytes. BER reduced body weight and caused a significant improvement in glucose tolerance without altering food intake in diabetic rats. Similarly, BER reduced plasma triglycerides and improved insulin action in diabetic rats. BER down-regulated the elevated expressions of gluconeogenesis key enzymes PEPCK and G6Pase, inhibited the translocation of TORC2 from cytoplasm to nucleus and increased AMPK activity in liver tissues. The effect of BER was higher when co-administered with sodium caprate. BER treatment resulted in reduced glucose production in HepG2 hepatocytes. BER increased AMPK activity, reduced the expression of PEPCK, and the nuclear transcription factors PGC-1, HNF-4α and FOXO1. The effect of BER on gluconeogenesis could be partly blocked by AMPK inhibitor, Compound C. BER could suppress hepatic gluconeogenesis in rat model of diabetes at least in part via stimulation of AMPK activity and this action of BER is augmented by sodium caprate.