The in vitro antioxidant activity of water extract from Dictyophora indusiate was evaluated by 1,1-diphenyl-2-picrylhydrazyl (DPPH) radical, hydroxyl radical and 2,2'-azino-bis (3-ethylbenzothiazoline-6-sulphonate) (ABTS) cation radical scavenging assays. Caenorhabditis elegans was used as a model organism to observe the effects of the extract at high (1.0 mg/mL), medium (0.5 mg/mL) and low (0.25 mg/mL) doses on oxidative and heat stress. In addition, the effects of the extract on fat deposition was analyzed by oil red O staining, and the level of triglyceride (TG) and the expression of fat metabolism-related genes in C. elegans were determined. The results showed that the extract enhanced antioxidant capacity in C. elegans. Its half maximal inhibitory concentrations on DPPH radical, hydroxyl radical and ABTS cation radical were 2.36, 1.44 and 0.86 mg/mL, respectively. The average life span of C. elegans under oxidative and heat stress was prolonged by 54.6% (P < 0.01) and 19.8% (P < 0.05) in the high-dose group, respectively. Compared with the control group, lipid deposition and TG level in the high-dose group decreased by 57.0% (P < 0.01) and 40.5% (P < 0.01), respectively. The mechanism may be that the water extract can down-regulate the regulation of mod-1, daf-1, fat-7, acs-2, daf-16 and mdt-15, up-regulate the expression levels of daf-2, sbp-1, nhr-49, fat-5 and fat-6, thereby improving lipid metabolism. These results show that the water extract of D. indusiate has antioxidant properties and can improve lipid metabolism.