Abstract Background Natural medicinal plants have been the focus of current research for developing neuroprotective agents to be used in the diabetes-linked cognitive dysfunction. Trigonella foenum-graecum seeds (known as fenugreek, methi in Hindi), is a well-known traditional medicinal herb and possesses anti-diabetic, anti-oxidant, and anti-inflammatory properties. Purpose This study was undertaken to explore the ameliorative effects of T. foenum-graecum seed extract on diabetes-induced cognitive dysfunction. Methods Experimental diabetes was induced by administering a single dose of streptozotocin (60 mg/kg) through intraperitoneal dose. Cognitive function was assessed using a T-maze and the Morris water maze. Lipid peroxidation levels and oxidative stress in the hippocampus was measured. Quantification of hippocampal CA1 and CA3 regions was done using cresyl violet stain. Results Diabetic rats demonstrated learning and memory impairment, which was evident from poor performance in behavioral tasks, i.e. T-maze and Morris water maze tasks. Learning and memory impairment in diabetic animals is associated with increased blood glucose levels, increased oxidative stress in the hippocampus and decreased number of neurons in the CA1 and CA3 regions of the hippocampus. The diabetic rats administered with T. foenum-graecum showed improved performance in behavioral tasks, and these changes were associated with decreased blood glucose levels, decreased oxidative stress in the hippocampus, and decreased neuronal loss from the CA1 and CA3 regions of the hippocampus. Conclusion In conclusion, administration of T. foenum-graecum seed extract ameliorates diabetes-linked cognitive dysfunction in rats by decreasing blood glucose levels, reducing lipid peroxidation and oxidative stress in the hippocampus, and preventing neuronal loss from the hippocampus.