We studied the effect of ethanolic leaf extract of Azadirachta indica (AIE) on the microanatomy of the kidney of streptozotocin-induced diabetic rats. Thirty male Wistar rats (161-190 g) were randomly assigned to one of five treatment groups of six animals each: control, diabetic, diabetic + AIE, diabetic + metformin, AIE only. Diabetes was induced with a single intraperitoneal dose of streptozotocin (70 mg/kg body weight). AIE and metformin were administered orally for 50 days (50 d) at 500 mg/kg bw/d and 350 mg/kg bw/d, respectively. Blood glucose was estimated by glucose oxidase method; plasma urea and creatinine were assayed; and paraffin sections of the kidney were stained by periodic acid-Schiff technique. Untreated diabetic rats exhibited marked hyperglycemia. Renal histopathology of these animals showed features of diabetic nephropathy, with nodular glomerulosclerosis and vacuolation of proximal tubule cells (Armanni-Ebstein phenomenon). These feature were absent in the diabetic rats treated with AIE. Besides, plasma urea and creatinine were not significantly different from the control in this group (p > 0.05), in contrast to the untreated diabetic rats, where significant increases in these markers (p < 0.05). These findings showed that the leaf extract of Azadirachta indica ameliorates hyperglycemia and diabetic nephropathy in rats.