Hypercholesterolemia is a major determinant of the decline of renal function in patients with diabetes. Apolipoprotein E polymorphism may influence the metabolism of lipoprotein in diabetic patients. The purpose of this study was to investigate the association between genetic polymorphisms in apolipoprotein E and the progression of diabetic nephropathy in patients with non-insulin-dependent diabetes mellitus over a 10-year period (13 to 37 years; median, 20 years). Subjects with a stable renal function without overt proteinuria had a higher cholesterol level, lower incidences of hypertension and proliferative diabetic retinopathy, and a higher frequency of the E4 allele than subjects with a decline in renal function (end-stage renal failure requiring dialysis treatment). In the diabetic patients, the apolipoprotein E4 carriers had a higher cholesterol level than did the noncarriers. The survival rate from renal disease in the apolipoprotein E4 carriers was higher than in the noncarriers among the diabetic patients. Apolipoprotein E polymorphism and hypertension were identified as independent risk factors for the progression to renal failure. Results indicate that apolipoprotein E polymorphism is associated with the progression of diabetic nephropathy. Presence of the apolipoprotein E4 allele is a protective factor, and other alleles are risk factors.