Diabetic nephropathy is a major cause of diabetes- related morbidity and mortality; however the clinical course of the disease and the renal prognosis is highly variable among individuals. The current review will discuss the genetic influence on the development of end stage renal disease (ESRD) in diabetic patients and potential improvements to the current treatment strategy to slow the loss of kidney function in these patients. In this first part, the growing evidence that glucose-induced activation of the intra-renal and systemic renin-angiotensin systems plays an essential role in processes leading to destruction of renal function is summarised. Genetic variations, especially the angiotensin-converting enzyme (ACE)/ID polymorphisms in the gene coding for ACE, are involved in activation of the renin-angiotensin system and seem to influence the clinical course of diabetic nephropathy during treatment with ACE inhibitors. In addition, this polymorphism may interact with other polymorphisms within the renin-angiotensin system, leading to high risk of ESRD. As new genetic approaches and methods develop, further understanding of diabetic nephropathy will evolve and genotyping will help prevent ESRD in diabetic patients.