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Diabetes mellitus (DM) causes injury to tissues and organs, including to the heart and kidney, resulting in increased morbidity and mortality. Thus, novel potential therapeutics are continuously required to minimize DM-related organ damage. We have previously shown that dipeptidyl peptidase III (DPPIII) has beneficial roles in a hypertensive mouse model, but it is unknown whether DPPIII has any effects on DM. In this study, we found that intravenous administration of recombinant DPPIII in diabetic db/db mice for eight weeks suppressed the DM-induced cardiac diastolic dysfunctions and renal injury without alteration of the blood glucose level. This treatment inhibited inflammatory cell infiltration and fibrosis in the heart, and blocked the increase in albuminuria by attenuating the disruption of the glomerular microvasculature and inhibiting the effacement of podocyte foot processes in the kidney. The beneficial role of DPPIII was, at least in part, mediated by the cleavage of a cytotoxic peptide, named Peptide 2, which was increased in db/db mice compared with normal mice. This peptide consisted of nine amino acids, was a digested fragment of complement component 3 (C3), and had an anaphylatoxin-like effect determined by the Miles assay and chemoattractant analysis. The effect was dependent on its interaction with the C3a receptor and protein kinase C-mediated RhoA activation downstream of the receptor in endothelial cells. In conclusion, DPPIII plays a protective role in the heart and kidney in a DM animal model through cleavage of a peptide that is a part of C3.