FGF-21 is a potential candidate for the treatment of type 2 diabetes mellitus. However, the clinical application of wild-type human FGF-21 is challenging due to some limitations, such as its poor hypoglycemic potency and short in vivo half-life. In this paper, we have produced an FGF-21 mutant (ahmFGF-21) by exchanging the functional domain of hFGF-21 with that of mFGF-21 to improve the potency of FGF-21. Results showed that the ahmFGF-21 protein was more potent than wild-type hFGF-21 in stimulating glucose uptake in vitro and lowering blood glucose levels of diabetic animals. To decrease its immunogenicity and increase its biostability, the N-terminus of ahmFGF-21 was modified in a sitespecific manner with 20 kDa mPEG-propionaldehyde (mPEG-ALD). We found that the preservation time of ahmFGF-21 in vitro was significantly prolonged after PEGylation. The serum antibody levels against ahmFGF-21 in immunized rabbits with the PEGylated ahmFGF-21 were significantly reduced than those with the unmodified ahmFGF-21, and the target protein concentration in the rabbits administrated with the PEGylated ahmFGF-21 increased 9.5-fold higher than that of the unmodified ahmFGF-21. The animal experimental results showed that PEGylation of ahmFGF-21 enhanced the hypoglycemic effect in diabetic mice. These results suggest that the in vitro and in vivo hypoglycemic effects of FGF-21 are significantly enhanced by genetic modification and the metabolic pharmacology of FGF-21 in type 2 diabetic mice is improved by PEGylation at a specific site.