Uncontrolled diabetes is associated with increased risk of bony fractures. However, the mechanisms have yet to be understood. Using high-resolution synchrotron micro-CT, we calculated the changes in the microstructure of femoral cortices of streptozotocin-induced hyperglycemic (STZ) Wistar Albino rats and tested the mechanical properties of the mineralized matrix by nanoindentation. Total lacunar volume of femoral cortices increased in STZ group due to a 9% increase in lacunar density. However, total vascular canal volume decreased in STZ group due to a remarkable decrease in vascular canal diameter (7 ± 0.3 vs. 8.5 ± 0.4 µm). Osteocytic territorial matrix volume was less in the STZ group (14,908 ± 689 µm3) compared with healthy controls (16,367 ± 391 µm3). In conclusion, hyperglycemia increased cellularity and lacunar density, decreased osteocyte territorial matrix, and reduced vascular girth, in addition to decreasing matrix mechanical properties in the STZ group when compared with euglycemic controls.