Skeletal muscle atrophy is one of the serious complications of diabetes. Zhimu-Huangbai herb-pair (ZB) is widely used in Chinese traditional medicine formulas for treating Xiaoke (known as diabetes) and its complications. However, the effect of ZB on reversal of muscle atrophy and the underlying mechanisms remain unknown. In this research, we investigated the effect and possible mechanisms of ZB on skeletal muscle atrophy in diabetic mice. Animal model of diabetic muscle atrophy was developed by high fat diet (HFD) feeding plus streptozotocin (STZ) injection. After oral adminstration of ZB for 6 weeks, the effects of ZB on reversal of muscle atrophy and the underlying mechanisms were evaluated by biochemical, histological and western blot methods. The skeletal muscle weight, strength, and cross-sectional area of diabetic mice were significantly increased by ZB treatment. Biochemical results showed that ZB treatment reduced the serum glucose level, and elevated the serum insulin-like growth factor 1 (IGF-1) and insulin levels significantly compared with untreated diabetic group. The western blot results showed that ZB activated the mTOR signal pathway, shown as increased phosphorylations (p-) of Akt, mTOR, Raptor, S6K1 and reduced Foxo3 expression compared with the model group. ZB could reverse muscle atrophy in diabetic mice. This may be through activation of mTOR signaling pathway that promotes protein synthesis, and inactivation foxo3 protein that inhibits protein degradation. These findings suggested that ZB may be considered as a potential candidate drug in treatment of diabetic muscle atrophy.