Diabetic nephropathy is one of the most significant microvascular complications in patients with type 2 diabetics. The concise mechanism of diabetic nephropathy is unknown and there is no successful treatment. The objective of study was to investigate effects of Chinese herbs (Tangshen Formula) on diabetic nephropathy in Otsuka Long-Evans Tokushima Fatty (OLETF) rats. OLETF rats and LETO rats were divided into four groups: LETO control, OLETF diabetics, OLETF diabetics treated with Tangshen Formula, and OLETF diabetics treated with Monopril. Body weight, blood glucose, and 24 h urinary proteins were measured once every four weeks. Blood samples and kidney tissues were obtained for analyses of total cholesterol, triglyceride, whole blood viscosity, plasma viscosity, and pathohistological examination at 36 and 56 weeksrespectively. Untreated OLETF rats displayed diabetic nephropathy over the study period. Treatment of OLETF rats with Tangshen Formula attenuated the increases in blood glucose, body weight, 24 h urinary protein content, serum total cholesterol, whole blood viscosity and plasma viscosity at certain time. Treatment with Tangshen Formula also reduced glomerulosclerotic index and interstitial fibrotic index seen in OLETF rats. In conclusion, Tangshen Formula could attenuate the development of diabetic nephropathy in OLETF rat diabetic model.