To observe the changes of lung injury when diabetic rats were treated with low concentration of ethanol (EtOH) and analyze the related mechanisms, male Sprague-Dawley (SD) rats were divided into control, diabetic (DM), and EtOH+DM groups. Diabetic rat was mimicked by injection of streptozotocin intraperitoneally. Fasting blood glucose (FBG) level, lung weight (LW), body weight (BW), and LW/BW were measured. The changes of lung tissue and Type II alveolar cell were detected. Pulmonary malondialdehyde (MDA) content and superoxide dismutase (SOD) activity were measured; meanwhile, ALDH2 mRNA and protein expressions were detected by RT-PCR and western blotting, respectively. Compared with control group, in DM group, SOD activity was decreased; FBG level, LW/BW, MDA content, ALDH2 mRNA, and protein expressions were decreased. Compared with DM group, in EtOH+DM group, SOD activity, ALDH2 mRNA, and protein expressions were increased; LW/BW and MDA content were decreased. The structures of lung tissue and lamellar bodies were collapsed in DM group; the injury was attenuated in EtOH+DM group. Our findings suggested that, in diabetic rat, pulmonary ALDH2 expression was decreased accompanying lung injury. EtOH at low concentration decreased diabetes induced lung injury through activating ALDH2 expression.