The potential enhancement of metformin hydrochloride (MH) loaded in lipid vesicles targeting therapeutic efficacy on alloxan-induced diabetic rats was investigated. This involved lipid vesicles formulated with homogenously distributed nano-sized particles by a novel integrated process of multiple emulsification by membrane and solvent evaporation. The average diameter of the water-in-oil (W1/O), W1/O/W2 emulsion droplets, and lipid vesicles was 192 nm, 52 µm, and 173 nm, respectively. The entrapment yield of metformin hydrochloride (MH) in the prepared lipid vesicles was 40.12%. The metformin hydrochloride-loaded lipid vesicles (MH-LLVs) sustained the release of the entrapped drug over a 12-h period and reduced the plasma glucose level of diabetic rats by 77.4% compared with free MH solution (2-h period and 58.2%, respectively) after one week post-diabetic treatment through oral administration of MH-LLV and the free drug. The remarkable improvement in the biochemical parameters recorded in the MH-LLV-treated animals compared with those that received free MH solutions depicted an enhanced kidney function, liver function, as well as oxidative stress status. Pancreatic histology depicted a pancreas with intralobular ducts (ID) and exocrine secretory acini that characterize an intact pancreas, which suggests the ability of the MH-LLVs to restore pancreatic cells to normal, on a continued treatment. Overall, MH-LLV appears an encouraging extended-release formulation with enhanced bioavailability, sustained release, and improved antihyperglycemic potentials.