Nucleotide-binding oligomerization domain-like receptor family pyrin domain-containing 3 (NLRP3) is an intracellular sensor that detects endogenous danger signals and environmental irritants to assemble into the NLRP3 inflammasome. Activation of the NLRP3 inflammasome leads to the secretion of the proinflammatory cytokines interleutkin (IL)-1β and IL-18 and induces pyroptosis. Recent studies have shown that the NLRP3 inflammasome participates in the initiation and progression of diabetic atherosclerosis through pathological mechanisms such as β-cell dysfunction, insulin resistance, endothelial cell dysfunction, monocyte adhesion and infiltration, and smooth muscle cell proliferation and migration. In diabetic atherosclerosis, Chinese medicine has been proven effective for the inflammatory response mediated by the NLRP3 inflammasome. This review summarizes the latest progress on the NLRP3 inflammasome in the pathogenesis and potential Chinese medicine treatment of diabetic atherosclerosis.