Aqueous solutions of aromatic hydrotropes were investigated for cell permeabilization and extraction of dioscin from dioscorea rhizomes. The extracted dioscin was further hydrolyzed in the same hydrotropic solutions to diosgenin without significant decomposition to 3,5-diene, unlike in the conventional process. The parameters affecting the extraction of dioscin, such as the nature and concentration of the hydrotrope, the temperature, and the particle size, were optimized. Sodium cumene sulfonate was the most efficient hydrotrope for the extraction of dioscin and also for its hydrolysis to diosgenin at 353 K. Diosgenin precipitates from aqueous NaCS solutions with >95% purity at 293 K because of its poor solubility in aqueous solutions.