Background: clinically detectable diabetic nephropathy is based on albumin excretion and glomerular filtration rate that mainly reflects the glomerular damage. New biomarkers have arisen with the promise of detecting kidney damage prior to the currently used markers. Objectives: to assess the usefulness of the urinary neutrophil gelatinase-associated lipocalin and kidney injury molecule-1 for the early diagnosis of diabetic kidney disease in type2 diabetes mellitus and to estimate their relation to the degree of nephropathy in comparison to the level of albuminuria and other parameters. Design: cross sectional study. Setting: the internal medicine department - al-zahraa university hospital and endocrinology department - helwan university hospital from 2014 / 2015. Patients and methods: seventy diabetic patients were chosen and divided into 3 subgroups (normoalbuminuric, microalbuminuric and macroalbuminuric), compared to 19 healthy controls. For all participants, clinical examination, urine analysis, fasting and 2hours post prandial serum glucose, glycated hemoglobin a1c%, serum cholesterol, triglycerides, serum creatinine, urea, estimated glomerular filtration rate, urinary albumin to creatinine ratio, urinary kim-1 and ngal were done. Results: both urinary ngal and kim-1 correlated positively with urinary albumin, disease duration and hba1c. Ukim-1 correlated negatively with estimated glomerular filtration rate. The cutoff point to differentiate the normoalbuminuric group from control for ukim-1 was 88.5ng/l. The diagnostic sensitivity was 91.6%, diagnostic specificity was 84%. At the cutoff value 3.25 μg/l for ungal the diagnostic sensitivity was 100%, diagnostic specificity was 89.4%. Conclusion: ukim-1 and ungal are sensitive and specific markers for detection of diabetic nephropathy in patients with type2 diabetes mellitus.