Diabetic nephropathy (DN), the most common cause of end-stage renal disease (ESRD), is increasingly considered an inflammatory process characterized by leukocyte infiltration at every stage of renal involvement. Cytokines act as pleiotropic polypeptides that regulate inflammatory and immune responses, providing important signals in the pathologic and physiologic processes. Inflammation and activation of the immune system are closely involved in the pathogenesis of diabetes and its microvascular complications. Proinflammatory, Th1, Th2, and Th17 cytokines, as well as TGF-beta, all take part in the development and progression of DN. Gene polymorphism of cytokines and their receptors may have functional variations and can be applied to predict the susceptibility and progression to DN. Improved knowledge on recognizing cytokines as significant pathogenic mediators in DN leaves opens the possibility of new potential therapeutic agents for future clinical treatments.