About 246 million people worldwide have diabetes in 2007. The global figure of people with diabetes is projected to increase to 370 million in 2030. As the prevalence of diabetes has risen to epidemic proportions worldwide, diabetic nephropathy has become one of the most challenging health problems. Therapeutic options such as strict blood glucose and blood pressure controls are effective for preventing diabetic nephropathy, but are far from satisfactory, and the number of diabetic patients on end-stage renal disease is still increasing. Therefore, a novel therapeutic strategy that could halt the progression of diabetic nephropathy should be developed. There is accumulating evidence that advanced glycation end products (AGEs), senescent macroprotein derivatives formed at an accelerated rate under diabetes, play a role in diabetic nephropathy via oxidative stress generation. In this paper, we review the pathophysiological role of AGEs and their receptor (RAGE)-oxidative stress system in diabetic nephropathy.