Although a wide variety of medicinal interventions and life style variations have been endeavored so far for the treatment of type 1 diabetes mellitus (T1DM), it's still intractable. The current study aimed to examine the effect of placental extract (PE) on streptozotocin (STZ) induced diabetic rats in comparison and in combination with Mesenchymal stem cells (MSCs). Fifty male albino rats were used. Ten of them as negative control (group I) and the remaining rats were subjected to diabetes induction using 40mg/kg one shot STZ then divided into; group II (untreated positive controls), group III (MSCs treated), group IV (PE treated), and group V (treated with combination of MSCs and PE). After four weeks of treatment, animals were sacrificed; blood samples were collected for determination of glycated hemoglobin by HPLC, serum was separated for determination of glucose spectrophotometrically and insulin by ELISA. Pancreatic tissues were harvested for histopathological examination and Pdx1gene expression by PCR. Results: The three treated groups showed significant enhancement in diabetes parameters and Pdx1 gene expression compared with positive control group (P