Diabetic nephropathy is characterized by an expansion of glomerular mesangium, caused by mesangial cell proliferation and excessive accumulation of extracellular matrix (ECM) proteins, which eventually leads to glomerulosclerosis and renal failure. Activator protein-1 (AP-1), a transcription factor, is implicated in the transcriptional regulation of a wide range of genes participating in cell proliferation and ECM production. This investigation was undertaken to test the hypothesis that AP-1 plays an important role in ECM gene expression, and to develop a molecular therapeutic strategy based on decoy oligodeoxynucleotides (ODN). In this report, we show that transfection with AP-1 decoy ODN strongly inhibits high glucose- and angiotensin II-induced cell proliferation and expression of ECM genes in cultured mesangial cells in vitro. Administration of AP-1 decoy ODN into streptozotocin-induced diabetic rat kidney in vivo using the hemagglutinating virus of Japan (HVJ)-liposome method virtually abolished TGF-beta1 and plasminogen activator inhibitor-1 expression. Our results collectively indicate that AP-1 activation is crucial for mesangial cell proliferation and ECM production in response to high glucose and angiotensin II. Moreover, use of stable AP-1 decoy ODN combined with the highly effective HVJ-liposome method provides a novel potential molecular therapeutic strategy for the prevention of diabetic nephropathy.