Diabetic nephropathy is the leading cause of chronic renal disease and a major cause of cardiovascular mortality. Diabetic nephropathy has been categorized into stages: microalbuminuria and macroalbuminuria. The cut-off values of micro- and macroalbuminuria are arbitrary and their values have been questioned. Subjects in the upper-normal range of albuminuria seem to be at high risk of progression to micro- or macroalbuminuria and they also had a higher blood pressure than normoalbuminuric subjects in the lower normoalbuminuria range. Diabetic nephropathy screening is made by measuring albumin in spot urine. If abnormal, it should be confirmed in two out three samples collected in a three to six-months interval. Additionally, it is recommended that glomerular filtration rate be routinely estimated for appropriate screening of nephropathy, because some patients present a decreased glomerular filtration rate when urine albumin values are in the normal range. The two main risk factors for diabetic nephropathy are hyperglycemia and arterial hypertension, but the genetic susceptibility in both type 1 and type 2 diabetes is of great importance. Other risk factors are smoking, dyslipidemia, proteinuria, glomerular hyperfiltration and dietary factors. Nephropathy is pathologically characterized in individuals with type 1 diabetes by thickening of glomerular and tubular basal membranes, with progressive mesangial expansion (diffuse or nodular) leading to progressive reduction of glomerular filtration surface. Concurrent interstitial morphological alterations and hyalinization of afferent and efferent glomerular arterioles also occur. Podocytes abnormalities also appear to be involved in the glomerulosclerosis process. In patients with type 2 diabetes, renal lesions are heterogeneous and more complex than in individuals with type 1 diabetes. Treatment of diabetic nephropathy is based on a multiple risk factor approach, and the goal is retarding the development or progression of the disease and to decrease the subject's increased risk of cardiovascular disease. Achieving the best metabolic control, treating hypertension (<130/80 mmHg) and dyslipidemia (LDL cholesterol <100 mg/dl), using drugs that block the renin-angiotensin-aldosterone system, are effective strategies for preventing the development of microalbuminuria, delaying the progression to more advanced stages of nephropathy and reducing cardiovascular mortality in patients with diabetes.