Dry eyes are caused by highly increased osmolarity of tear film, inflammation, and apoptosis of the ocular surface. In this study, we investigated the effect of Polygonum cuspidatum (PCE) aqueous extract in in vivo and in vitro dry eye models. Dry eye was induced by excision of the lacrimal gland and hyperosmotic media. In vivo, oral administration of PCE in exorbital lacrimal gland-excised rats recovered tear volume and Mucin4 (MUC4) expression by inhibiting corneal irregularity and expression of inflammatory cytokines. In vitro, hyperosmotic media induced human corneal epithelial cell (HCEC) cytotoxicity though increased inflammation, apoptosis, and oxidative stress. PCE treatment significantly inhibited expression of cyclooxygenase-2 and inflammatory cytokines (interleukin-6 and tumor necrosis factor-α), and activation of NF-κB p65 in hyperosmolar stress-induced HCECs. Hyperosmolarity-induced increase in Bcl-2-associated X protein (BAX) expression and activation of cleaved poly (ADP-ribose) polymerase and caspase 3 were attenuated in a concentration-dependent manner by PCE. PCE treatment restored anti-oxidative proteins such as heme oxygenase-1 (HO-1), superoxide dismutase-1 (SOD-1), and glutathione peroxidase (GPx) in hyperosmolar stress-induced HCECs. These data demonstrate that PCE prevents adverse changes in the ocular surface and tear fluid through inhibition of hyperosmolar stress-induced inflammation, apoptosis, and oxidation, suggesting that PCE may have the potential to preserve eye health.