In this study we examined the temporal changes in neuropeptide Y (NPY) expression in dorsal root ganglion (DRG) neurons and cuneate nucleus (CN) in streptozotocin (STZ)-induced diabetic rats with or without median nerve transection (MNT). Numerous NPY-like immunoreactive (NPY-LI) neurons and fibers were detected in the DRG and CN of the diabetic MNT (DMNT) rats respectively, but not in those with diabetes-alone. Following MNT, the time-course of NPY expression pattern in the diabetic DRG and CN was similar and both peaked at 2 weeks, which was earlier than those in the non-diabetic MNT rats. Consequently, the expression of neurotrophin-3 (NT-3) immunoreactivity in DRG neurons was coincidentally decreased and reached the nadir at 2 weeks in the diabetic MNT rats, which was also earlier than that in the non-diabetic MNT rats. Following electrical stimulation of the injured nerves, the number of NPY-LI fibers became attenuated and the induced c-Fos-LI cells concurrently appeared in the ipsilateral CN. In the diabetic CN, the number of c-Fos-LI cells also peaked at 2 weeks after MNT, which was consistent with the temporal pattern of changes in NPY expression. The results suggest that in diabetes, MNT induced NPY expression via the reduction of NT-3, and electrical stimulation of the injured median nerve evoked the release of NPY and accordingly more c-Fos-LI cells were identified in the CN. Furthermore, this study demonstrated early NPY and c-Fos expression in the diabetic rats after MNT, suggesting that the development of neuropathic signs may be advanced in hyperglycemic rats.