Neutrophil gelatinase-associated lipocalin (NGAL), also called lipocalin 2, is considered a promising biomarker for acute and chronic kidney injuries. Several studies have demonstrated that its levels increase in plasma and urine in diabetic nephropathy (DN), and its urine concentration increases upon kidney function deterioration. However, its role in DN progression remains unclear. The current study used in vitro gene expression knockdown in human proximal tubular cell line human kidney (HK)2 to investigate the role of NGAL in oxidation and extracellular matrix secretion under high-glucose (HG) incubation. In addition, type 1 diabetes was induced in vivo in knockout NGAL(-/-) and wild-type mice in order to investigate role of NGAL in the progression of DN. The results demonstrated that NGAL knockdown in HK2 cells significantly increased oxidative stress under HG stimulation tested by flow cytometry, and increased the secretion of interleukin-6, fibronectin (FN) and collagen IV examined by ELISA. Western blotting demonstrated that the phosphorylation of Smad2/3 also increased in HK2 cells under transforming growth factor-beta 1 stimulation. In vivo experiments demonstrated that diabetic NGAL(-/-) mice showed deteriorated renal function compared with that of diabetic wild-type mice. Histopathological analysis suggests that diabetic NGAL(-/-) mice had more serious glomerulosclerosis and tubular vascular degeneration than wild-type mice. Immunohistochemistry suggested that the absence of NGAL lead to increased FN deposition in glomeruli in a mouse model of DN. In conclusion, NGAL appears to have renal protective effects by slowing down the progression of DN, and its effect may be associated with a reduction in oxidation, fibrosis and inflammation.