In type 2 diabetic hypertensive patients, microalbuminuria can be due to hypertension and/or diabetic nephropathy. Angiotensin-converting enzyme (ACE) inhibitors act preferentially on microalbuminuria due to diabetic nephropathy. The objective is to demonstrate the efficacy of a thiazide-like diuretic, indapamide sustained release (SR), at reducing microalbuminuria in hypertensive type 2 diabetic patients in comparison with an ACE inhibitor, enalapril. The study is an international multicentre, 12-month, randomized, double-blind, controlled, two parallel group study of type 2 diabetic patients with hypertension (140 mmHg < or = systolic blood pressure <180 mmHg and diastolic blood pressure <110 mmHg) and microalbuminuria. Intervention is after a 4-week placebo period, patients with microalbuminuria > or = 20 and < or = 200 microg/min are randomized to indapamide SR 1.5 mg or to enalapril 10 mg once a day for a one-year treatment period. An additional label treatment by amlodipine 5-10 mg (1st step) and atenolol 50-100 mg (2nd step) a day is permitted after 6 weeks of treatment based upon blood pressure response. The main outcome measures are microalbuminuria expressed as urinary albumin to creatinine ratio, albumin fractional clearance, and albumin excretion rate evaluated on overnight urine collections. Secondary criteria are supine and standing systolic, diastolic and mean blood pressure; and biological and clinical safety. This study will complete the knowledge of the efficacy of indapamide SR in hypertension and target organ damage and will provide valuable information on the management of type 2 diabetic hypertensives with microalbuminuria.