Sterol regulatory element binding protein (SREBP) is an important potential mediator of kidney fibrosis and is known to be upregulated in diabetic nephropathy. We evaluated the effectiveness of SREBP inhibition as treatment of diabetic nephropathy. Type 1 diabetes was induced in uninephrectomized male CD1 mice with streptozotocin. The mice were treated with the SREBP inhibitor fatostatin for 12 weeks. At the endpoint, kidney function and pathologic findings were assessed. Fatostatin inhibited the increase of both isoforms of SREBP (types 1 and 2) in diabetic kidneys. Treatment attenuated basement membrane thickening but did not improve hyperfiltration, albuminuria, or kidney fibrosis in diabetic mice. The treatment of nondiabetic mice with fatostatin led to hyperfiltration and increased the glomerular volume to levels seen in diabetic mice. This was associated with increased renal inflammation and a trend toward increased renal fibrosis. Both in vivo and in cultured renal proximal tubular epithelial cells, fatostatin increased the expression of the proinflammatory cytokine monocyte chemoattractant protein-1. Thus, SREBP inhibition with fatostatin not only is ineffective in preventing diabetic nephropathy but also leads to kidney injury in nondiabetic mice. Further research on the efficacy of other SREBP inhibitors and the specific roles of SREBP-1 and SREBP-2 in the treatment and pathogenesis of diabetic nephropathy is needed.