Deterioration of β-cells in the pancreas is a crucial factor in the progression of Type 2 diabetes. Inhibition of enzyme DiPeptidyl Peptidase (DPP) -IV is considered as an anti-diabetic drug target which enhances the active Glucagon Like Peptide (GLP) -1 in the blood stream resulting in restoration of pancreatic β-cell mass and function. A number of plant and plant products are being used for the treatment of diabetes. Aloe vera is known to have anti-diabetic potential and the work carried out at our Centre by Noor et.al, 2008 had shown that oral feeding of Aloe vera extract to diabetic rats exhibited anti-diabetic potentials by restoring pancreatic islet mass and functions. In this study, we characterized the phytochemical constituents of Aloe vera extract and demonstrated that the Aloe vera extract inhibits DPP-IV with an IC50 value of 2.716 mg. We further discussed the implications of using such natural products in treating diabetic patients.