Cytochrome P-450 (CYP) epoxygenases metabolize arachidonic acid into epoxyeicosatrienoic acids (EETs), which play important roles in regulating cardiovascular functions. The anti-inflammatory, antiapoptotic, proangiogenic, and antihypertensive properties of EETs suggest a beneficial role for EETs in diabetic nephropathy. Endogenous EET levels are maintained by a balance between synthesis by CYP epoxygenases and hydrolysis by epoxide hydrolases into physiologically less active dihydroxyeicosatrienoic acids. Genetic disruption of soluble epoxide hydrolase (sEH/EPHX2) results in increased EET levels through decreased hydrolysis. This study investigated the effects of sEH gene disruption on diabetic nephropathy in streptozotocin-induced diabetic mice. Streptozotocin-induced diabetic manifestations were attenuated in sEH-deficient mice relative to wild-type controls, with significantly decreased levels of Hb A(1c), creatinine, and blood urea nitrogen and urinary microalbumin excretion. The sEH-deficient diabetic mice also had decreased renal tubular apoptosis that coincided with increased levels of antiapoptotic Bcl-2 and Bcl-xl, and decreased levels of the proapoptotic Bax. These effects were associated with activation of the PI3K-Akt-NOS3 and AMPK signaling cascades. sEH gene inhibition and exogenous EETs significantly protected HK-2 cells from TNFα-induced apoptosis in vitro. These findings highlight the beneficial role of the CYP epoxygenase-EETs-sEH system in the pathogenesis of diabetic nephropathy and suggest that the sEH inhibitors available may be potential therapeutic agents for this condition.