Matrix metalloproteinases (MMPs) are a family of proteolytic enzymes that degrade the extracellular matrix (ECM). The membrane-type matrix metalloproteinases (MT-MMPs) are a new family of MMPs that differ from other MMPs in that they have a transmembrane domain that anchors them to the cell surface. MT-MMPs have been shown to function as receptors and activators for other MMPs and to localize extracellular matrix proteolysis at the pericellular region. Here we report on mRNA and protein expression of the fifth human MT-MMP (MT5-MMP), a 64-kDa protein that is capable of converting pro-MMP-2 to its active form, in human kidney as well as its upregulation in diabetes. We also demonstrate upregulation of the active form of MMP-2 in kidney samples from patients with diabetes. Through immunohistochemistry, MT5-MMP expression was localized to the epithelial cells of the proximal and distal tubules, the collecting duct, and the loop of Henle. Furthermore, the tubular epithelial cells that expressed MT5-MMP were associated with tubular atrophy. Because renal tubular atrophy is a significant factor in the pathogenesis of diabetic nephropathy and renal failure and the molecular mechanisms regulating this process remain unknown, it is hypothesized that the elevated expression of MT5-MMP contributes to the activation of pro-MMP-2, which participates in the remodeling of the proximal and distal tubules as well as in the collecting duct. These results provide the first evidence of the expression of a MT-MMP in diabetes and suggest a novel role for MT5-MMP in the pathogenesis of renal tubular atrophy and end-stage renal disease.