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Type 2 diabetes mellitus (T2DM) is a widespread metabolic disorder characterized by insulin resistance and pancreatic β-cell dysfunction, posing a substantial global health challenge. This review systematically summarizes the therapeutic potential of berberine, a natural isoquinoline alkaloid, in the management of T2DM. Berberine's pharmacological activities are discussed from multiple perspectives, including enhancing insulin sensitivity and regulating glucose metabolism-encompassing glycogen synthesis, gluconeogenesis, and glucose transport. The review also highlights berberine's anti-inflammatory, antioxidant, and epigenetic enzyme-targeting actions and its involvement in key T2DM-related signaling pathways such as AKT, AMPK, and GLUTs. These findings collectively elucidate the multi-targeted and multi-pathway molecular mechanisms underlying berberine's efficacy against T2DM. Additionally, the review covers the pharmacological activities and molecular mechanisms of berberine in treating T2DM complications-including diabetic nephropathy, retinopathy, cardiomyopathy, neuropathy, and diabetic foot ulcers-as well as its clinical and preclinical applications and the synergistic benefits of combination therapy with agents such as metformin, ginsenoside Rb1, and probiotics. By systematically reviewing the literature retrieved from PubMed and Web of Science up to 2025, this article provides a comprehensive summary of current research, offering a theoretical foundation for the clinical use of berberine in T2DM therapy.