Type 2 diabetes is a major health concern and a rapidly growing disease with a modern etiology, which produces significant morbidity and mortality. The optimal management of type 2 diabetes aims to control hyperglycemia, hypertension, and dyslipidemia to reduce overall risks. Diabetes and its complications usually develop as oxidative stress increases. Monascus-fermented rice, also called red mold rice or red mold dioscorea are used in China to enhance food color and flavor. Red mold-fermented products are popular health foods that are considered to have antiobesity, antifatigue, antioxidation, and cancer prevention effects. This review article describes the antidiabetic and antioxidative stress effects on humans and animals of red mold-fermented products or their secondary metabolites.