The diabetic epidemic that is being experienced around the world has many ramifications. Since diabetes is the most common cause of end stage renal disease in the United States and the Western world, we can expect the increase in prevalence to continue. Minority individuals with diabetes suffer a disproportionately high incidence of diabetic nephropathy leading to end stage renal disease. The data suggest that aggressive medical management should be their mainstay of therapy. In the past five years, our knowledge of the mechanisms involved in the pathology of diabetic glomerulosclerosis has greatly expanded. Transforming growth factor (TGF)-beta still maintains a key role in the pathogenesis. However, many of the signaling mechanisms have now been described. Furthermore, TGF-beta may also function to damage glomerular epithelial cells or podocytes, resulting in podocyteuria and proteinuria that worsen with progressive diabetic nephropathy. Additionally, TGF-beta upregulation in diabetes may cause injury or transformation of tubular epithelial cells that contribute to interstitial fibrosis. The use of thiazolidinediones in type 2 diabetes is associated with improvement in insulin sensitivity, as well as improvement in albuminuria. The mechanisms by which these ligands function remain unclear, but there may be several targets that could include mesangial cells and podocytes.