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<i>Plantago australis</i> Lam. Subsp. hirtella (Kunth) Rahn is a medicinal plant used as a diuretic, anti-inflammatory, antibacterial, throat cancer treatment and for the control of diabetes. <i>P. australis</i> was collected in the state of Morelos, México. The hydroalcoholic extract (HAE<i>Pa</i>) of <i>P. australis</i> was obtained by maceration and concentrated in vacuo. Once dry, it was evaluated through an oral glucose tolerance test (OGTT) in normoglycemic mice and in a non-insulin-dependent diabetic mice model. The expression of PPARγ and GLUT-4 mRNA was determined by rt-PCR, and GLUT-4 translocation was confirmed by confocal microscopy. The toxicological studies were conducted in accordance with the guidelines suggested by the OECD, sections 423 and 407, with some modifications. HAE<i>Pa</i> significantly decreased glycemia in OGTT curves, as well as in the experimental diabetes model compared to the vehicle group. In vitro tests showed that HAE<i>Pa</i> induced an α-glucosidase inhibition and increased PPARγ and GLUT-4 expression in cell culture. The LD₅₀ of HAE<i>Pa</i> was greater than 2000 mg/kg, and sub-chronic toxicity studies revealed that 100 mg/kg/day for 28 days did not generate toxicity. Finally, LC-MS analysis led to the identification of verbascoside, caffeic acid and geniposidic acid, and phytochemical approaches allowed for the isolation of ursolic acid, which showed significant PPARγ overexpression and augmented GLUT-4 translocation. In conclusion, HAE<i>Pa</i> induced significant antidiabetic action by insulin sensitization through PPARγ/GLUT-4 overexpression.