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Despite rigorous endeavors, existing attempts to handle type 2 diabetes (T2DM) are still a long way off, as a substantial number of patients do not meet therapeutic targets. Insulin resistance in skeletal muscle is discerned as a forerunner in the pathogenesis of T2DM and can be detected years before its progress. Studies have revealed the antidiabetic properties of <i>Carica papaya</i> (<i>C. papaya</i>), but its molecular mechanism on insulin receptor substrate-1 (IRS-1)/Akt signaling mechanisms is not yet known. The present study aimed to evaluate the role of <i>C. papaya</i> on IRS1 and Akt in high-fat-diet–streptozotocin-induced type 2 diabetic rats and also to analyze the bioactive compounds of <i>C. papaya</i> against IRS-1 and Akt via in silico analysis. Ethanolic extract of the leaves of <i>C. papaya</i> (600 mg/kg of body weight) was given daily for 45 days postinduction of T2DM up to the end of the study. Gluconeogenic enzymes, glycolytic enzymes, gene expression, and immunohistochemical analysis of IRS-1 and Akt in skeletal muscle were evaluated. <i>C. papaya</i> treatment regulated the levels of gluconeogenic and glycolytic enzymes and the levels of IRS-1 and Akt in skeletal muscle of type 2 diabetic animals. In silico studies showed that trans-ferulic acid had the greatest hit rate against the protein targets IRS-1 and Akt. <i>C. papaya</i> restored the normoglycemic effect in diabetic skeletal muscle by accelerating the expression of IRS-1 and Akt.