The renin-angiotensin system plays a key role in the progression of kidney disease, in addition to its well-described role in the maintenance of extracellular fluid volume and blood pressure. Recent studies have shown that blockade of the renin-angiotensin system at the level of the angiotensin II type 1 receptor can have important effects on proteinuria and the rate of progression of kidney disease in patients with type 2 diabetes mellitus. This review first discusses recent experimental studies relating angiotensin II to kidney function in diabetes mellitus and changes in glomerular permselectivity, and then focuses on recent clinical trials with angiotensin II receptor blockers in patients with type 2 diabetes mellitus.