This study aims at exploring earthworm protein hydrolysate and its peptide fractions as a potential hypoglycemic agent by inhibiting α-amylase and α-glucosidase. Firstly, the best hydrolysis conditions to gain the hydrolysates with the highest α-amylase inhibitory activity (α-AIA) and α-glucosidase inhibitory activity (α-GIA) were figured out using a one-factor test. Next, the stability of the hypoglycemic activity of the hydrolysates and their 5 peptide fractions recovered using ultrafiltration membranes were assessed by employing the tests of in vitro digestion, thermal, and pH treatment. The results showed that at the best hydrolysis conditions, the hydrolysates exhibited α-AIA of 91.30 ± 2.51% and α-GIA of 44.69 ± 0.47%. Specifically, the <1 kDa peptide fraction from the hydrolysate expressed a greater α-AIA than that of acarbose, with nearly the same α-GIA as that of voglibose. The α-AIA and α-GIA of the hydrolysates and their fractions were enhanced after the in vitro digestion treatment, whereas they remained over 40% after the pH treatment in the range of 1 to 11 or heat treatment at 100 °C for 180 min. These data provide the preliminary evidence to develop the earthworm protein hydrolysate and its peptide fractions in functional food or nutraceutical products with hypoglycemic activity.