Adiponectin is an antidiabetic endogenous adipokine that have protective role in unfavorable metabolic sequalae arising from obesity. Recent evidence suggests a sinister link between hypoadiponectinemia and development of insulin resistance/ type 2 diabetes (T2D). The insulin sensitizing property of adiponectin is through specific adipoq receptors R1 & R2, activation of AMP-activated protein kinase (AMPK) and peroxisome proliferator-activated receptor (PPAR)α pathways. AdipoAI is a novel synthetic analogue of endogenous adiponectin with possibly similar pharmacological effects. Thus, there is a need of orally active small molecules that activate Adipoq subunits, and its downstream signaling could ameliorate obesity related type 2 diabetes. This study was aimed to access the effects of AdipoAI on obesity and T2D. Through in-vitro and in-vivo analyses, we investigated the anti-diabetic potentials of AdipoAI and compared it with AdipoRON, another orally active adiponectin receptors agonist. Our results showed that In-vitro treatment of AdipoAI (0-5µM) increased adiponectin receptor subunits AdipoR1/R2 with increase in AMPK and APPL1 protein expression in C2C12 myotubes. Similarly, in-vivo, oral administration of AdipoAI (25 mg/kg) observed similar effects as that of AdipoRON (50 mg/kg) with improved control of blood glucose and insulin sensitivity in diet-induced obesity (DIO) mice models. Further, AdipoAI significantly reduced epididymal fat content with decrease in inflammatory markers and increase in PPAR-a and AMPK levels and exhibited hepatoprotective effects in liver. Further, AdipoAI and AdipoRON also observed similar results in adipose tissue. Thus, our results suggest that low doses of orally active small molecule agonist of adiponectin AdipoAI can be a promising therapeutic target for obesity and T2D.