Objectives Vascular dementia (VaD), being strongly associated with metabolic conditions is a major health concern around the world. Diabetes is a major risk factor for the development of VaD. This study investigates the efficacy of quercetin and folacin in diabetes induced vascular endothelium dysfunction and related dementia. Methods Single dose streptozotocin (STZ) (50 mg/kg i.p) was administered to albino Wistar rats (male, 200–250 g) by dissolving in citrate buffer. Morris water maze (MWM) and attentional set shifting tests were used to assess the spatial learning, memory, reversal learning, and executive functioning in animals. Body weight, serum glucose, serum nitrite/nitrate, vascular endothelial function, aortic superoxide anion, brains’ oxidative markers (thiobarbituric acid reactive species-TBARS, reduced glutathione-GSH, superoxide dismutase-SOD, and catalase-CAT), mitochondrial enzyme complex (I, II, and IV), inflammatory markers (interleukin-IL-6, IL-10, tumor necrosis factor-TNF-α, and myeloperoxidase-MPO), and acetylcholinesterase activity-AChE were also assessed. Quercetin (30 mg kg −1 /60 mg kg −1 ) and folacin (30 mg kg −1 /60 mg kg −1 ) were used as the treatment drugs. Donepezil (0.5 mg kg −1 ) was used as a positive control. Results STZ administered rats showed reduction in learning, memory, reversal learning, executive functioning, impairment in endothelial function, increase in brains’ oxidative stress; inflammation; AChE activity, and decrease in mitochondrial complex (I, II, and IV) activity. Administration of quercetin and folacin in two different doses, significantly attenuated the STZ induced diabetes induced impairments in the behavioral, endothelial, and biochemical parameters. Conclusions STZ administration caused diabetes and VaD which was attenuated by the administration of quercetin and folacin. Therefore, these agents may be studied further for the assessment of their full potential in diabetes induced VaD conditions.