Cyclosporine (CsA) has improved patient and graft survival rates following solid-organ transplantation and has been increasingly applied with significant clinical benefits in the management of autoimmune diseases. However, the clinical use of CsA is often limited by acute and chronic nephrotoxicity, which remains a major problem. Acute nephrotoxicity depends on the dosage of CsA and seems to be caused by a reduction in renal blood flow related to afferent arteriolar vasoconstriction. However, the mechanisms underlying chronic CsA nephrotoxicity are not fully understood. Activation of the intrarenal renin-angiotensin system, increased release of endothelin-1, dysregulation of nitric oxide (NO) and NO synthase, upregulation of transforming growth factor-beta1, inappropriate apoptosis, stimulation of inflammatory mediators, and enhanced immunogenecity have all been implicated in the pathogenesis of chronic CsA nephrotoxicity. Reducing the CsA dose or withdrawing it and using combined nephroprotective drugs (mycophenolate mofetil, losartan, and pravastatin) may ameliorate chronic CsA-induced renal injury. This review discusses new insights and preventive strategies for this clinical dilemma.