The proposed mechanisms for the development of nephropathy are many, complex and often overlapping. Although recent literature strongly supports a role of kidney hypoxia as an independent pathway to nephropathy, the evidence remains inconclusive since the role of hypoxia is difficult to differentiate from confounding factors such as hyperglycemia, hypertension and oxidative stress. By increasing kidney oxygen consumption using triiodothyronine (T3) and, thus, avoiding these confounding factors, the aim of the present study was to investigate renal hypoxia per se as a causal pathway for the development of nephropathy. Healthy Sprague-Dawley rats were treated with T3 (10 μg/kg/day) and the angiotensin II AT1-receptor antagonist candesartan (1 mg/kg in drinking water) to eliminate effects of T3-induced renin release; and compared to a candesartan treated control group. After 7 weeks of treatment in vivo kidney function, oxygen metabolism and mitochondrial function were evaluated. T3 did not affect glomerular filtration rate or renal blood flow, but increased total kidney oxygen consumption resulting in cortical hypoxia. Nephropathy, demonstrated as albuminuria and tubulointerstitial fibrosis, developed in T3-treated animals. Mitochondria uncoupling mediated by uncoupling protein 2 and the adenosine nucleotide transporter was demonstrated as a mechanism causing the increased kidney oxygen consumption. Importantly, blood glucose levels, mean arterial blood pressure and oxidative stress levels were not affected by T3. In conclusion, the present study provides further evidence for increased kidney oxygen consumption causing intrarenal tissue hypoxia, as a causal pathway for development of nephropathy.