Multiple sclerosis (MS) is especially known as a demyelinating disease of the central nervous system. Current treatments for MS are mostly based on controlling neuroinflammation and there are no treatments to promote the remyelination process at present. Diosgenin is a known herbal anti-inflammatory and antioxidant agent, which has also been shown to stimulate the growth of myelin in vitro. However, there is no or little evidence about diosgenin effects; specially on myelination, neuroprotection and its corresponding mechanisms in vivo in experimental autoimmune encephalomyelitis (EAE) as the most valid experimental model of MS. In this study, the therapeutic effect of diosgenin on clinical signs of EAE, and the corresponding cellular and molecular mechanisms have been examined with emphasis on myelination and neuroprotection mechanisms. EAE was induced using myelin oligodendrocyte glycoprotein (MOG) antigen in C57BL/6 mice. Diosgenin was gavaged (100 mg/kg) daily with the onset of paralysis signs (half tail paralysis) until the 18th post-immunization day in the treatment group. Blood and spinal cord tissue sampling was performed on post-immunization day 18. Lumbar spinal cord inflammation, demyelination, and axonal degeneration were assessed using Hematoxylin and Eosin (H & E), Luxol Fast Blue (LFB), and Bielschowsky's silver staining methods, respectively. Serum and spinal cord tissue level of tumor necrosis factor alpha (TNFα) and tissue levels of matrix metalloproteinase 9 (MMP-9) and interleukin 17 (IL-17) as inflammatory markers, microtubule-associated proteins 1A/1B light chain 3A (MAP1LC3A), and activity dependent neuroprotector homeobox (ADNP) as neuroprotective markers were assayed using enzyme linked immunosorbent assay (ELISA) method. The clinical score of EAE in the diosgenin treatment group was significantly reduced compared to the EAE group on days 15 to 18 after induction of the EAE (p < 0.001). Inflammation, demyelination and axonal loss scores also decreased significantly in the diosgenin treatment group compared to the EAE group (p < 0.05). Serum and spinal cord tissue level of TNFα and tissue level of MMP-9 considerably decreased in the diosgenin treatment group in comparison with the EAE group (p < 0.01). Diosgenin treatment had no significant effects on the tissue levels of IL-17, ADNP and MAP1LC3A. Therefore, diosgenin improved the clinical signs of EAE through lowering neuroinflammation, demyelination and axonal degeneration, but did not significantly affect the neuroprotective factors in this study. As a result, diosgenin could be a good candidate for new MS treatment strategies that, in addition to their anti-inflammatory effects, also enhance myelination.