Gegen Qinlian Decoction (GQD), a traditional Chinese medicine (TCM) formula, has long been used for the treatment of common metabolic diseases, including type 2 diabetes mellitus. However, the main limitation of its wider application is ingredient complexity of this formula. Thus, it is critically important to identify the major active ingredients of GQD and to illustrate mecha-nisms underlying its action. Here, we compared the effects of GQD and berberine, a hypothetical key active pharmaceutical ingredient of GQD, on a diabetic rat model by comprehensive analyses of gut microbiota, short-chain fatty acids, proinflammatory cytokines, and ileum transcriptomics. Our results show that berberine and GQD had similar effects on lowering blood glucose levels, modulating gut microbiota, inducing ileal gene expression, as well as relieving systemic and local inflammation. As expected, both berberine and GQD treatment significantly altered the overall gut microbiota structure and enriched many butyrate-producing bacteria, including Faecalibacterium and Roseburia, thereby attenuating intestinal inflammation and lowering glucose. Levels of short-chain fatty acids in rat feces were also significantly elevated after treatment with ber-berine or GQD. Moreover, concentration of serum proinflammatory cytokines and expression of immune-related genes, including Nfkb1, Stat1, and Ifnrg1, in pancreatic islets were significantly reduced after treatment. Our study demonstrates that the main effects of GQD can be attributed to berberine via modulating gut microbiota. The strategy employed would facilitate further stan-dardization and widespread application of TCM in many diseases.