With recent insight into the development of dietary supplements and functional foods, search of effective phytochemical compounds and their mechanisms involved in prevention and management of diabetes and its complications are now being assessed. Cinnamic acid and its derivatives occur naturally in high levels of plant-based foods. Among various biological activities, cinnamic acid and its derivatives are associated with a beneficial influence on diabetes and its complications. The aim of the review is to summarize the potential mechanisms of these compounds for prevention and management of diabetes and its complications. Based on several in vitro studies and animal models, cinnamic acid and its derivatives act on different mechanism of actions, including stimulation of insulin secretion, improvement of pancreatic β-cell functionality, inhibition of hepatic gluconeogenesis, enhanced glucose uptake, increased insulin signaling pathway, delay of carbohydrate digestion and glucose absorption, and inhibition of protein glycation and insulin fibrillation. However, due to the limited intestinal absorption being a result of low bioavailability of cinnamic acid and its derivatives, current improvement efforts with entrapping into solid and liquid particles are highlighted. Further human clinical studies are needed to clarify the effects of cinnamic acid and its derivatives in diabetic patients.