The zucker diabetic fatty (ZDF-fa/fa) rat is one of the attractive models for type II diabetes based on impaired glucose tolerance caused by the inherited insulin-resistance gene fa. Characterization of nephropathy in this model may provide useful insights into the mechanism of the progression of diabetic nephropathy. The present study analyzed the pathophysiology of diabetes and nephropathy, including the process of glomerulosclerosis in this model by biochemical and morphometric analyses. In addition, we conducted studies in podocytes in culture to examine the direct effects of high glucose on podocytes. ZDF-fa/fa rats showed overt diabetes despite hyperinsulinemia as early as 3 months of age. Blood glucose levels increased further with a considerable decrease of insulin levels at 5 months. Glomerular filtration rate (GFR) was significantly elevated until 3 months, but fell to the level seen in lean rats by 7 months. Proteinuria started to rise during the period of increased GFR, and increased further after GFR had fallen to within the normal range. Renal fibronectin, collagen iv, and vascular endothelial growth factor mRNA levels were increased at 7 months. Glomerulosclerosis commenced as early as 5 months of age, and was associated with glomerular hypertrophy and mild mesangial expansion with evidence of accentuated podocyte injury, as revealed by increased expression of desmin. Electron microscopy suggested that degeneration of podocytes and the development of tuft adhesions were responsible for the glomerular sclerosis in this model. In addition, glomeruli from the diabetic rats showed up-regulation of the cyclin kinase inhibitors, p21 and p27. Further studies suggested that the increase in p27 expression was predominantly caused by podocytes, because predominant immunolocalization of p27 in podocytes in diabetic rats and high glucose medium induced cell hypertrophy accompanied by p27 up-regulation in differentiated podocyte cell lines. In conclusion, progressive diabetic nephropathy in ZDF-fa/fa rats is associated with evidence of podocyte injury. High concentrations of ambient glucose induced podocyte hypertrophy and stress in vitro, suggesting that the podocyte is a likely target of the diabetic milieu.