Peripheral neuropathy is one of the most common complications of diabetes mellitus. Using a mouse model of diabetic peripheral neuropathy, we tested the hypothesis that thymosin β4 (Tβ4) ameliorates diabetes-induced neurovascular dysfunction in the sciatic nerve and promotes recovery of neurological function from diabetic peripheral neuropathy. Tβ4 treatment of diabetic mice increased functional vascular density and regional blood flow in the sciatic nerve, and improved nerve function. Tβ4 upregulated angiopoietin-1 (Ang1) expression, but suppressed Ang2 expression in endothelial and Schwann cells in the diabetic sciatic nerve. In vitro, incubation of Human Umbilical Vein Endothelial Cells (HUVECs) with Tβ4 under high glucose condition completely abolished high glucose-downregulated Ang1 expression and high glucose-reduced capillary-like tube formation. Moreover, incubation of HUVECs under high glucose with conditioned medium collected from Human Schwann Cells (HSCs) treated with Tβ4 significantly reversed high glucose-decreased capillary-like tube formation. PI3K/Akt signaling pathway is involved in Tβ4-regulated Ang1 expression on endothelial and Schwann cells. These data indicate that Tβ4 likely acts on endothelial cells and Schwann cells to preserve and/or restore vascular function in the sciatic nerve which facilitates improvement of peripheral nerve function under diabetic neuropathy. Thus, Tβ4 has potential for the treatment of diabetic peripheral neuropathy.