Background: Tinospora cordifolia (TC) is a widely used shrub in Ayurveda system of medicine. The main chemical constituent reported from this shrub is alkaloid with nitrogen heterocycles such as tropane alkaloids, thiazole, piperidines, and pyridine derivatives; nonisoprene indole alkaloids; and pseudoalkaloids with antidiabetic effects. Materials and Methods: The nanoparticles (NPs) were synthesized via solvent evaporation method using a biodegradable poly(D,L-lactide) (PLA) polymer. The NPs were then characterized using spectroscopic methods, X-ray diffraction, and scanning electron microscopy. Release profile and entrapment efficiency of the NPs are studied. Further, the synthesized NPs were evaluated for the inhibitory activity to find the antidiabetic potential and compared with docking analysis. Results: In this study, the TC extract was loaded to PLA NPs by the solvent evaporation method. The synthesis of NPs is sonicated at 40% amplitude at 30 s to get 48% of yield. The loading efficiency was found to be 76.21% for 5 mg and 58.10% for 10 mg. Release profile was observed with controlled release up to 8 h and 70% of TC was released after 40 h. Release kinetic showed good correlation with Higuchi kinetics. The maximum inhibitory percentage of TC-loaded PLA NPs was found to be 92.59 ± 0.854 and shows potential activity for diabetes. The interaction of the compounds with the receptor, fentanyl, and cholic acid showed that the highest binding energies of −6.09 and −6.4 have the potential to activate the insulin receptor. Conclusion: The result proves that TC stem extract possesses a therapeutic effect on diabetes and it is noticeable that acarbose interaction with insulin receptor shows minimum binding affinity when compared to the compounds from mass spectrum shows the highest binding affinity which acts as an insulin activator and responsible for the inhibitory action of α-glucosidase.