Monascin (MS) is a yellow compound isolated from Monascus-fermented products that has pancreatic protective, anti-inflammatory, anti-oxidative, and hypolipidemic activity. We recently found that MS also acts as a peroxisome proliferator-activated receptor-gamma (PPARγ) agonist, thereby promoting insulin sensitivity in C2C12 cells. However, the attenuation of hyperglycemia by MS treatment in vivo remains uncertain. In the present study, both MS and pioglitazone significantly down-regulated blood glucose and hyperinsulinemia in fructose-rich diet (FRD)-induced C57BL/6 mice (8 weeks). In addition, inhibitions of inflammatory factor production, serum dyslipidemia, and hepatic fatty acid accumulation by MS and pioglitazone were attenuated by GW9662 (PPARγ antagonist). These results were mediated by MS-suppressing FRD-elevated lipogenic transcription factors, including sterol regulatory element-binding protein-1c (SREBP-1c), carbohydrate response element-binding protein (ChREBP), PPARγ coactivator-1α (PGC-1α), and PPARγ coactivator-1β (PGC-1β). Taken together, de novo lipogenesis results in hyperlipidemia and hyperglycemia by fructose induction thereby leading to diabetes development; we found that MS may inhibit lipogenesis in FRD-induced mice. These findings suggest that MS acts as an antidiabetic agent and thus may have therapeutic potential for prevention of diabetes.