The function of metformin in colorectal cancer (CRC) patients with diabetes mellitus (DM) remains a controversial topic because studies are increasingly focusing on epidemiologic features. We examined Notch1/Hes1 signaling in CRC with DM (DM-CRC) and investigated alterations in signaling caused by metformin treatment. For this purpose, information on pathological characteristics was collected from each patient. The proliferation of epithelium labeled with proliferating cell nuclear antigen and the differentiation of goblet cells were investigated using immunohistochemistry and periodic acid-Schiff staining, respectively. The factors involved in Notch1/Hes1 signaling were detected using qRT-PCR and western blot. In our study, we found that lymphatic metastasis, pTNM staging, and the carcinoembryonic antigen level were significantly different between groups. The depth of crypts and the rate of proliferating cell nuclear antigen-positive cells were distinctly higher in DM-CRC and patients who were managed with insulin. Moreover, the goblet cell differentiation rate was decreased in DM-CRC. The expression of Dll1, Notch1, Math1, and RBP-Jκ was increased in DM-CRC, whereas the expression of Dll4 and Hes1 was decreased in this group in normal tissue. In CRC tissue, the expression of Dll1 and Notch1 was clearly higher than that in DM-CRC. Furthermore, the trend in these changes was aggravated with insulin management and alleviated with metformin treatment. In conclusion, the abnormal cell proliferation and differentiation observed in DM-CRC are correlated with overactivated Notch1/Hes1 signaling, which is potentially relieved by metformin treatment.