A stability-indicating HPLC method was developed and validated for the quantitative determination of diacerein in capsule dosage form. An isocratic separation was achieved using a C18, 250×4.6 mm, 5 µm particle size column with a flow rate of 1 ml/min and using a UV detector to monitor the eluent at 258 nm. The mobile phase consisted of Water: acetonitrile (70:30v/v). The drug was subjected to oxidation, hydrolysis, neutral, thermal and photolytic degradation. Diacerein was found to degrade under acidic, basic, oxidative, neutral and also dry heat condition. Complete separation of degraded products was achieved from the parent compound. All degradation products were eluted in an overall analytical run time of approximately 10 min with the parent compound diacerein eluting at approximately 6.44 min. The method was linear over the concentration range of 5-15 µg/ml (R2 = 0.999) with a limit of detection and quantitation of 0.0093 and 0.028 µg/ml respectively. The method has the requisite accuracy, selectivity, sensitivity, precision and can be used to assay diacerein in tablet. Degradation products resulting from the stress studies did not interfere with the detection of diacerein and the assay is thus stability-indicating.