Diabetic neuropathy is associated with mitochondrial dysfunction and neuroinflammation. Chronic hyperglycemia triggers inflammatory responses and oxidative stress, causing peripheral neuropathy, whereas mitochondrial dysfunction caused by increased ROS generation and reduced bioenergetics maintains the inflammatory cycle. The purpose of this study is to evaluate the pharmacological efficacy of Bay 11-7082 (B11) against diabetic neuropathy in rats. B11 was administered at doses of 1 and 3 mg/kg to STZ-induced diabetic animals (55 mg/kg, i.p). Behavioral and functional assessments were conducted to assess neuropathy. Molecular protein expressions were evaluated for B11's efficacy against STZ-induced diabetic neuropathic rats and in SHSY5Y cells exposed to 175 mM of d-glucose. Diabetic rats exhibited deficits in nerve functions, altered nociceptive parameters, and increased expression of NLRP3, ASC, Caspase-1, and NF-κB. Additionally, diabetic animals showed reduced levels of PGC1α/Nrf2/HO-1, with an overexpression of PARP1. Compromised mitochondrial function was evident through increased mitochondrial dynamic marker DRP1 and elevated levels of inflammatory cytokines TNF-α, IL-1β, IL-18, and IL-6. However, B11 administration significantly ameliorated these changes, suggesting that B11's NLRP3 inhibition may be attributed to the activation of the mitochondrial biogenesis pathway via PGC1α/Nrf2/HO-1, along with improved mitochondrial health. In high glucose exposed SHSY5Y cells, B11 treatment attenuated neuroinflammation by inhibiting NLRP3 activation and reducing mitochondrial damage. B11, showed a protective effect against diabetic neuropathy by inhibiting oxidative stress, NLRP3 activation, and improving mitochondrial health in experimental diabetic neuropathy. This study provides new mechanistic insights into the neuroprotective role of Bay 11-7082 against diabetic neuropathy.