The aim of this study was to evaluate whether L-Arginine (L-Arg) supplementation modifies nitric oxide (NO) system and consequently aquaporin-2 (AQP2) expression in the renal outer medulla of streptozotocin-diabetic rats at an early time point after induction of diabetes. Male Wistar rats were divided in four groups: Control, Diabetic, Diabetic treated with L-Arginine and Control treated with L-Arginine. Nitric oxide synthase (NOS) activity was estimated by [14C] L-citrulline production in homogenates of the renal outer medulla and by NADPH-diaphorase staining in renal outer medullary tubules. Western blot was used to detect the expression of AQP2 and NOS types I and III; real time PCR was used to quantify AQP2 mRNA. The expression of both NOS isoforms, NOS I and NOS III, was decreased in the renal outer medulla of diabetic rats and L-Arg failed to prevent these decreases. However, L-Arg improved NO production, NADPH-diaphorase activity in collecting ducts and other tubular structures, and NOS activity in renal homogenates from diabetic rats. AQP2 protein and mRNA were decreased in the renal outer medulla of diabetic rats and L-Arg administration prevented these decreases. These results suggest that the decreased NOS activity in collecting ducts of the renal outer medulla may cause, at least in part, the decreased expression of AQP2 in this model of diabetes and constitute additional evidence supporting a role for NO in contributing to renal water reabsorption through the modulation of AQP2 expression in this pathological condition. However, we cannot discard that another pathway different from NOS also exists that links L-Arg to AQP2 expression.