Lipid metabolism disorder and inflammation are essential promoters in pathogenesis of liver injury in type 2 diabetes. Puerarin (PUR) has been reported to exert beneficial effects on many diabetic cardiovascular diseases and chemical-induced liver injuries, but its effects on diabetic liver injury and its mechanism are still unclear. The current study was designed to explore the therapeutic effect and mechanism of PUR on liver injury in a type 2 diabetic rat model induced by a high-fat diet combined with low-dose streptozotocin. The diabetic rats were treated with or without PUR (100 mg/kg/day) by gavaging for 8 weeks, and biochemical and histological changes in liver were examined. Results showed that treatment with PUR significantly attenuated hepatic steatosis by regulating blood glucose and ameliorating lipid metabolism disorder. Liver fibrosis was relieved by PUR treatment. PUR inhibited oxidative stress and inflammation which was associated with inactivation of NF-κB signaling, thereby blocking the upregulation of proinflammatory cytokines (IL-1β, TNF-α) and chemokine (MCP-1). This protection of PUR on diabetic liver injury is possibly related with inhibition on TGF-β/Smad signaling. In conclusion, the present study provides evidence that PUR attenuated type 2 diabetic liver injury by inhibiting NF-κB-driven liver inflammation and the TGF-β/Smad signaling pathway.