In 47 patients with diabetic nephropathy (29 type I, 18 type II) renal function and blood pressure (BP) (treated with or without an angiotensin-converting enzyme [ACE] inhibitor, enalapril [10 mg], in 38 hypertensive patients) were followed over 4 years. A percutaneous renal biopsy was performed in all patients initially and repeated in a representative 19 patients with treated hypertension after 4 years. Mean glomerular volume (MGV), interstitial fibrosis (IF), capillary volume, and sclerosed glomeruli (GS) were measured histomorphometrically. Mean fall in creatinine clearance (CCr) was 11.8% after 4 years with no difference between treatment groups or type of diabetes. BP both initially and during treatment correlated with initial and final serum creatinine and CCr (P < 0.01). There were no histomorphometric differences between type I and type II patients or hypertension treatment groups. Initial IF correlated with initial and final serum creatinine and CCr (P < 0.05) in all patients and type I patients alone, MGV correlated inversely with CCr in type I patients (P < 0.05). After 4 years, IF (24.8 vs. 30.0%, P < 0.01) and GS (26 vs. 37%, P < 0.05) increased significantly, and increase in IF correlated with fall in CCr (P < 0.01). Proteinuria and HbA1 did not correlate with indexes of function or structure. In this longitudinal study of patients with diabetic nephropathy, there was a close relation between BP and renal function but no difference between treatment with enalapril and other hypertensive agents. The correlations between renal function and histology at entry and after 4 years suggest that IF is a co-determinant of renal function in diabetic nephropathy.