Sustained hyperglycemia and increased oxidative stress play major roles in the development of secondary complications in diabetes including liver injury. Dietary supplement of antioxidants is effective in preventing oxidative stress mediated tissue damage in diabetic pathophysiology. D-Saccharic acid 1,4-lactone (DSL), a derivative of D-glucaric acid, is present in many dietary plants and is known for its detoxifying and antioxidant properties. Our early investigation showed that DSL can ameliorate alloxan (ALX) induced diabetes mellitus and oxidative stress in rats by inhibiting pancreatic β-cell apoptosis. In the present study we investigated the protective role of DSL against hepatic dysfunction in ALX induced diabetic rats. ALX exposure elevated the blood glucose, serum ALP and ALT levels, the production of reactive oxygen species (ROS), and disturbed the intra-cellular antioxidant machineries. Oral administration of DSL restored all these alterations close to normal. By investigating the mechanism of its protective activity, we observed that DSL prevented hyperglycemia induced hepatic apoptosis by inhibiting both extrinsic and intrinsic pathways. Results showed that in the liver tissue, diabetes promoted a significant increase of TNF-α/TNF-R1 and led to the activation of caspase-8 and t-Bid. In addition, ALX exposure reciprocally regulated Bcl-2 family protein expression, disturbed mitochondrial membrane potential, and subsequently released cytochrome c from mitochondria to cytosol. As a consequence, a significant increase in caspase-3 expression was observed in the liver of diabetic animals. However, treatment of diabetic rats with DSL counteracted these changes, making it a promising approach in lessening diabetes mediated tissue damage.