Long-term diabetic patients suffer immensely from diabetic neuropathy. This study was designed to investigate the effects of hydrogen sulfide (H2S) on peripheral neuropathy, activation of microglia, astrocytes, and the cascade secretion of proinflammatory cytokines in the streptozotocin (STZ)-induced peripheral diabetic neuropathy rat model. STZ-induced diabetic rats were treated with the water-soluble, slow-releasing H2S donor GYY4137 (50 mg/kg; i.p.) daily for 4 weeks. Antiallodynic/antihyperalgesic activities were evaluated using different tests and histopathological changes and the expression of proinflammatory cytokines in the spinal cord were examined. GYY4137 treatment produced neuroprotective effects in the spinal cord of diabetic animals and modulated their sensory deficits. The treatment decreased allodynia (p < 0.05) and mechanical hyperalgesia (p < 0.01) and restored thermal hyperalgesia (p < 0.001) compared with diabetic rats. The treatment decreased the microglial response and increased astrocyte counts in spinal cord gray and white matter compared with untreated diabetic rats. Proinflammatory cytokines were reduced in the treated group compared with diabetic rats. These results suggest that H2S has a potentially ameliorative effect on the neuropathic pain through the control of astrocyte activation and microglia-mediated inflammation, which may be considered as a possible treatment of peripheral nerve hypersensitivity in diabetic patients.