Emerging evidence suggests that thiazole compounds are of great interest due to their protective effect against DM. Protective effects of thiazole derivatives against hyperglycemia have been demonstrated in earlier in vitro and in vivo studies. Previously, anti-oxidant and free radical scavenging activities of 2-(4-Fluorobenzamido)-4-methylthiazole-5-carboxylicacid, a newly developed thiazole derivative (NDTD), have been well-documented. Current study investigated the pharmacological effect of NDTD on hyperglycaemia, insulin sensitivity, lipid profile, anti-inflammatory and oxidative stress markers in an animal model. T2DM was induced in neonatal rats using single i.p. injection of STZ at a dose of 100mg/kg. As a result, significant increase in serum glucose, insulin and HOMA-IR, lipid and pro-inflammatory cytokines levels were observed in STZ diabetic rats compared to normal control rats. Administration of NDTD for 4 weeks reversed the increased levels of above mentioned parameters to normal. Increased serum TG, TC, LDL-C and VLDL-C levels were significantly lowered, while reduction of serum HDL-C was alleviated after administration of NDTD. In addition, NDTD attenuated oxidative stress markers by increasing levels of GSH, CAT, SOD and lowering the level of MDA. Similarly, NDTD showed its pharmacological effects against hepatic and renal injury markers via restoring the alleviated level of ALT, AST, BUN, CRE and uric acid. In addition, all the results obtained from the biochemical estimations were supported by the histopathological examination. Pancreatic histopathological study demonstrated reduction in the size of pancreatic islets as well as the number of β-cells, per islet in the STZ control group and diabetic rats exposed to NDTD normalized the morphology of islets. Furthermore, histopathological study of liver suggests the protective role of NDTD against hepatic injury, as diabetic rats exposed with NDTD shows significantly reduction in inflammation and lesion as compared to STZ control rats. Our findings concluded, NDTD attenuated hyperglycaemia, glucose intolerance and insulin resistance through its anti-oxidant and anti-inflammatory effects. Thus, we suggest NDTD as potential therapeutic candidate for T2DM. In addition, the current study also investigated the beneficial effects of NDTD against inflammation, hyperlipidemia, renal and hepatic injury.