Natural product berberine (BBR) has been reported to have hypoglycemic and insulin-sensitizing activities; however, its mechanism remains unclear. This study was designed to investigate the molecular mechanism of BBR against insulin resistance. Here, we identify insulin receptor (InsR) as a target of BBR to increase insulin sensitivity. In cultured human liver cells, BBR increased InsR messenger RNA (mRNA) and protein expression in a dose- and time-dependent manner. Berberine increased InsR expression in the L6 rat skeletal muscle cells as well. Berberine-enhanced InsR expression improved cellular glucose consumption only in the presence of insulin. Silencing InsR gene with small interfering RNA or blocking the phosphoinositol-3-kinase diminished this effect. Berberine induced InsR gene expression through a protein kinase C (PKC)-dependent activation of its promoter. Inhibition of PKC abolished BBR-caused InsR promoter activation and InsR mRNA transcription. In animal models, treatment of type 2 diabetes mellitus rats with BBR lowered fasting blood glucose and fasting serum insulin, increased insulin sensitivity, and elevated InsR mRNA as well as PKC activity in the liver. In addition, BBR lowered blood glucose in KK-Ay type 2 but not in NOD/LtJ type 1 diabetes mellitus mice that were insulin deficient. Our results suggest that BBR is a unique natural medicine against insulin resistance in type 2 diabetes mellitus and metabolic syndrome.