ABSTRACT: OBJECTIVE: We evaluated the structural-functional relationships and the prognostic factors for renal events, cardiovascular events, and all-cause mortality in type 2 diabetic patients with biopsy-proven diabetic nephropathy. RESEARCH DESIGN AND METHODS: Japanese type 2 diabetic patients with biopsy-proven diabetic nephropathy (n = 260) were enrolled. Patients were stratified by albuminuria (proteinuria) and estimated glomerular filtration rate (eGFR) at the time of renal biopsy. The outcomes were the first occurrence of renal events (requirement of dialysis or a 50% decline in eGFR from baseline), cardiovascular events (cardiovascular death, nonfatal myocardial infarction, coronary interventions, or nonfatal stroke), and all-cause mortality. RESULTS: The factors associated with albuminuria (proteinuria) regardless of eGFR were hematuria, diabetic retinopathy, low hemoglobin, and glomerular lesions. The factors associated with low eGFR regardless of albuminuria (proteinuria) were age and diffuse, nodular, tubulointerstitial, and vascular lesions. The glomerular, tubulointerstitial, and vascular lesions in patients with normoalbuminuria (normal proteinuria) and low eGFR were more advanced compared to those in patients with normoalbuminuria (normal proteinuria) and maintained eGFR. In addition, compared to patients with micro-/macroalbuminuria (mild/severe proteinuria) and low eGFR, their tubulointerstitial and vascular lesions were similar or more advanced in contrast to glomerular lesions. The mean follow-up period was 8.1 years. There were 118 renal events, 62 cardiovascular events, and 45 deaths. The pathological determinants were glomerular lesions, interstitial fibrosis and tubular atrophy (IFTA), and arteriosclerosis for renal events, arteriosclerosis for cardiovascular events, and IFTA for all-cause mortality. The major clinical determinant for renal events and all-cause mortality was macroalbuminuria (severe proteinuria). CONCLUSIONS: Our study suggests that the characteristic pathological lesions as well as macroalbuminuria (severe proteinuria) were closely related to the long-term outcomes of biopsy-proven diabetic nephropathy in type 2 diabetes.