In biomedical research, the fruit fly (Drosophila melanogaster) is among the most effective and flexible model organisms. Through the use of the Drosophila model, molecular mechanisms of human diseases can be investigated and candidate pharmaceuticals can be screened. White rot fungus Inonotus obliquus is a member of the family Hymenochaetaceae. Due to its multifaceted pharmacological effects, this fungus has been the subject of scientific investigation. Nevertheless, the precise mechanisms by which Inonotus obliquus treats diseases remain unclear. In this study, we prepared an aqueous extract derived from Inonotus obliquus and demonstrated that it effectively prevented the negative impacts of inflammatory agents on flies, including overproliferation and overdifferentiation of intestinal progenitor cells and decreased survival rate. Furthermore, elevated reactive oxygen species levels and cell death were alleviated by Inonotus obliquus aqueous extract, suggesting that this extract inhibited intestinal inflammation. Additionally, Inonotus obliquus aqueous extract had an impact on the insulin pathway, as it alleviated growth defects in flies that were fed a high-sugar diet and in chico mutants. In addition, we determined the composition of Inonotus obliquus aqueous extract and conducted a network pharmacology analysis in order to identify prospective key compounds and targets. In brief, Inonotus obliquus aqueous extract exhibited considerable potential as a therapeutic intervention for human diseases. Our research has established a foundational framework that supports the potential clinical implementation of Inonotus obliquus.