Urtica dioica L. Stinging nettle has long been known worldwide as a medicinal plant. To study the benefits of the nettle in diabetic encephalopathy, the granule cell density of the dentate gyrus of diabetic rats was studied following administration of Urtica dioica extract. A total of 24 male albino Wistar rats were allocated equally to normal, diabetic, preventive and treatment groups. Hyperglycaemia was induced by streptozotocin (80 mg/kg) in the animals of the diabetic and treatment groups. One week after injection of the streptozotocin the animals in the treatment group received a hydroalcoholic extract of Urtica dioica (100 mg/kg/day) for 4 weeks intraperitoneally. The rats of the preventive group received hydroalcoholic extract of U. dioica (100 mg/kg/day) IP for the first 5 days and an injection of streptozotocin (80 mg/kg) on the 6th day. After 5 weeks of study all the rats were sacrificed and coronal sections were taken from the dorsal hippocampal formation of the right cerebral hemispheres and stained with cresyl violet. The area densities of the granule cells were measured and compared in the four groups. The density was lower in the diabetic rats compared with the controls (p > 0.05). The preventive group showed lower cell density than the controls (p > 0.05). The densities in the treated rats were higher than in the diabetic rats (p > 0.05). Furthermore, the control and treated rats showed similar densities (p > 0.05). It seems that U. dioica extract can help compensate for granule cell loss in the diabetic rat dentate gyrus, which can ameliorate cognitive impairment in diabetes. However, preventive use of the extract showed no significant benefit.