Annona squamosa, commonly known as custard apple, is traditionally used for the treatment of various diseases including diabetes, cardiovascular disease (CVD), and gastritis. This study was undertaken to investigate the effects of an ethanolic (80% v/v) extract of A. squamosa (EEAS) leaves in vitro on insulin secretion from clonal pancreatic BRIN BD11 β-cells and mouse islets, including mechanistic studies on the effect of EEAS on membrane potential and intracellular calcium ion concentration. Additional in vitro glucose-lowering actions were assessed. For in vivo studies, high-fat-fed (HFF) obese/normal rats were selected. EEAS increased insulin secretion in vitro in a dose-dependent manner. This effect was linked to β-cell membrane depolarisation and cytoplasmic Ca2+ influx. In the presence of isobutyl methylxanthine (IBMX), tolbutamide, or KCl, the insulin-releasing effect of EEAS was increased, suggesting its effect was also mediated via a KATP-independent pathways. EEAS inhibited insulin glycation, glucose absorption, and DPP-IV enzyme activity in vitro and enhanced glucose uptake and insulin action in 3T3L1 cells. In vivo, gut motility, food intake, glucose tolerance, plasma insulin, and active GLP-1 (7-36) levels were improved, whereas plasma DPP-IV levels were reduced in HFF rats. EEAS attenuated the absorption of sucrose and glucose as well as decreased serum glucose levels after sucrose loading and in situ intestinal perfusion in non-diabetic rats. Rutin, proanthocyanidin, and squafosacin G were putatively identified as the anti-hyperglycaemic phytomolecules in EEAS using HPLC followed by LC-MS analysis. This study illustrates the potential of A. squamosa and its phytoconstituents as a source of potential antidiabetic agents.