Diabetic nephropathy has become, one of the most frequent causes of chronic renal failure in the industrialized countries. Basic and clinical research aimed at the clarification of the pathogenesis of diabetic kidney disease is of utmost importance. The role of non-enzymatic glycosylation, the polyol cycle, oxidative stress, various hormones and cytokines in the development of diabetic nephropathy is very likely. However, there is still no unifying concept about the relative importance and interaction of these factors. This paper reviews the most important directions and results of basic research centering on diabetic kidney disease. The coming years will likely bring the elaboration of a detailed theory of the pathogenesis and an even tighter coordination of basic and clinical research.