Diabetic nephropathy is a growing health concern with characteristic sterile inflammation. As the underlying mechanisms of this inflammation remain poorly defined, specific therapies targeting sterile inflammation in diabetic nephropathy are lacking. Intriguingly, an association of diabetic nephropathy with inflammasome activation has recently been shown, but the pathophysiological relevance of this finding remains unknown. Within glomeruli, inflammasome activation was detected in endothelial cells and podocytes in diabetic humans and mice and in glucose-stressed glomerular endothelial cells and podocytes in vitro. Abolishing Nlrp3 or caspase-1 expression in bone marrow-derived cells fails to protect mice against diabetic nephropathy. Conversely, Nlrp3-deficient mice are protected against diabetic nephropathy despite transplantation of wild-type bone marrow. Pharmacological IL-1R antagonism prevented or even reversed diabetic nephropathy in mice. Mitochondrial reactive oxygen species (ROS) activate the Nlrp3 inflammasome in glucose or advanced glycation end product stressed podocytes. Inhibition of mitochondrial ROS prevents glomerular inflammasome activation and nephropathy in diabetic mice. Thus, mitochondrial ROS and Nlrp3-inflammasome activation in non-myeloid-derived cells aggravate diabetic nephropathy. Targeting the inflammasome may be a potential therapeutic approach to diabetic nephropathy.