Diabetic nephropathy is a leading cause of end‐stage renal disease, which is increasing in incidence worldwide, despite intensive treatment approaches such as glycemic and blood pressure control in patients with diabetes mellitus. New therapeutic strategies are needed to prevent the onset of diabetic nephropathy. Peroxisome proliferator‐activated receptors (PPARs) are ligand‐activated nuclear transcription factors that play important roles in lipid and glucose homeostases. These agents might prevent the progression of diabetic nephropathy, since PPAR agonists improve dyslipidemia and insulin resistance. Furthermore, data from murine models suggest that PPAR agonists also have independent renoprotective effects by suppressing inflammation, oxidative stress, lipotoxicity, and activation of the renin‐angiotensin system. This review summarizes data from clinical and experimental studies regarding the relationship between PPARs and diabetic nephropathy. The therapeutic potential of PPAR agonists in the treatment of diabetic nephropathy is also discussed.