Hyperalgesia and allodynia are commonly observed in patients with diabetic neuropathy. The mechanisms responsible for neuropathic pain are not well understood. Thus, in this study, we examined the role played by purinergic P2X3 receptors of the midbrain periaqueductal gray (PAG) in modulating diabetes-induced neuropathic pain because this brain region is an important component of the descending inhibitory system to control central pain transmission. Our results showed that mechanical withdrawal thresholds were significantly increased by stimulation of P2X3 receptors in the dorsolateral PAG of rats (n = 12, P < 0.05 vs. vehicle control) using α,β-methylene-ATP (α,β-meATP, a P2X3 receptor agonist). In addition, diabetes was induced by an intraperitoneal injection of streptozotocin (STZ) in rats, and mechanical allodynia was observed 3 weeks after STZ administration. Notably, the excitatory effects of P2X3 stimulation on mechanical withdrawal thresholds were significantly blunted in STZ-induced diabetic rats (n = 12, P < 0.05 vs. control animals) as compared with control rats (n = 12). Furthermore, the protein expression of P2X3 receptors in the plasma membrane of the dorsolateral PAG of STZ-treated rats was significantly decreased (n = 10, P < 0.05 vs. control animals) compared to that in control rats (n = 8), whereas the total expression of P2X3 receptors was not significantly altered. Overall, data of our current study suggest that a decrease in the membrane expression of P2X3 receptors in the PAG of diabetic rats is likely to impair the descending inhibitory system in modulating pain transmission and thereby contributes to the development of mechanical allodynia in diabetes.