The objective of our study was to evaluate the effect of Physalis peruviana L. fruits in the management of diabetes and diabetic nephropathy in relation to its metabolic profile. In-vitro α-amylase, β-glucosidase, and lipase inhibition activities were assessed for the ethanolic extract (EtOH) and its subfractions. Ethyl acetate (EtOAc) fraction showed the highest α-amylase, β-glucosidase, and lipase inhibition effect. In vivo antihyperglycemic testing of EtOAc in streptozotocin (STZ)-induced diabetic rats showed that it decreased the blood glucose level, prevented the reduction in body weight, improved serum indicators of kidney injury (urea, uric acid, creatinine), and function (albumin and total protein). EtOAc increased autophagic parameters (LC3B, AMPK) and depressed mTOR contents. Histopathology revealed that EtOAc ameliorated the pathological features and decreased the glycogen content induced by STZ. The immunohistochemical analysis showed that EtOAc reduced P53 expression as compared to the STZ-diabetic group. UPLC-ESI-MS/MS metabolite profiling of EtOAc allowed the identification of several phenolic compounds. Among the isolated compounds, gallic acid, its methylated dimer and the glycosides of quercetin had promising α-amylase and β-glucosidase inhibition activity. The results suggest that the phenolic-rich fraction has a protective effects against diabetic nephropathy presumably via enhancing autophagy (AMPK/mTOR pathway) and prevention of apoptosis (P53 suppression).