Diabetic nephropathy (DN), a severe microvascular complication frequently associated with both type 1 and type 2 diabetes mellitus, is a leading cause of renal failure. The condition can also lead to accelerated cardiovascular disease and macrovascular complications. Currently available therapies have not been fully efficacious in the treatment of DN, suggesting that further understanding of the molecular mechanisms underlying the pathogenesis of DN is necessary for the improved management of this disease. Although key signal transduction and gene regulation mechanisms have been identified, especially those related to the effects of hyperglycaemia, transforming growth factor β1 and angiotensin II, progress in functional genomics, high-throughput sequencing technology, epigenetics and systems biology approaches have greatly expanded our knowledge and uncovered new molecular mechanisms and factors involved in DN. These mechanisms include DNA methylation, chromatin histone modifications, novel transcripts and functional noncoding RNAs, such as microRNAs and long noncoding RNAs. In this Review, we discuss the significance of these emerging mechanisms, how they mediate the actions of growth factors to augment the expression of extracellular matrix and inflammatory genes associated with DN and their potential usefulness as diagnostic biomarkers or novel therapeutic targets for DN.