Diabetic encephalopathy is a major complication with cognitive impairment and neurodegeneration in patients with type 1 or type 2 diabetes mellitus (DM). DM-induced glucolipotoxicity is a risk factor for Alzheimer’s disease–like phenotype, including amyloidogenesis, tau hyperphosphorylation, and neuronal apoptosis. Although the detailed mechanism underlying the pathogenesis of diabetic encephalopathy remains unclear, mitochondrial oxidative stress is emerging as a key factor for diabetic complications and neurodegeneration. A deeper understanding of the regulatory mechanism of mitochondrial oxidative stress under hyperglycemic conditions will provide insights into the development of therapeutic strategies for diabetic encephalopathy. Here, we review the role of mitochondrial oxidative stress in diabetic encephalopathy and the regulatory mechanisms by which high glucose induces the generation of mitochondrial reactive species oxygen species in neuronal cells. This review also summarizes the mitochondrial-dependent and -independent pathways (O-linked-N-acetylglucosaminylation, calcium, and glycogen synthase kinase 3β signaling) that regulate mitochondrial oxidative stress in a DM model.