The diabetes mellitus (DM) skin shows skin barrier dysfunction and skin lipid abnormality, similar to conditions induced by systemic or local glucocorticoid excess and aged skin. Inactive glucocorticoid (GC) is converted into active glucocorticoid by 11β-hydroxysteroid dehydrogenase type 1 (11β-HSD1). Hyperglycemia in DM and excessive GC are known to increase endoplasmic reticulum (ER) stress. We hypothesized that hyperglycemia affects systemic GC homeostasis and that the action of skin 11β-HSD1 and GC contributes to increased ER stress and barrier defects in DM. We compared 11β-HSD1, active GC, and ER stress between hyperglycemic and normoglycemic conditions in normal human keratinocytes anddb/dbmice. 11β-HSD1 and cortisol increased with time in keratinocyte culture under hyperglycemic conditions. 11β-HSD1 siRNA-transfected cells did not induce cortisol elevation in hyperglycemic condition. The production of 11β-HSD1 and cortisol was suppressed in cell culture treated with an ER stress-inhibitor. The 14-week-olddb/dbmice showed higher stratum corneum (SC) corticosterone, and skin 11β-HSD1 levels than 8-week-olddb/dbmice. Topical 11β-HSD1 inhibitor application indb/dbmice decreased SC corticosterone levels and improved skin barrier function. Hyperglycemia in DM may affect systemic GC homeostasis, activate skin 11β-HSD1, and induce local GC excess, which increases ER stress and adversely affects skin barrier function.