It has been reported that angiotensin II receptor blocker (ARB) improves proteinuria in diabetic patients. However, whether this is a direct effect of ARB or through lowering blood pressure is still controversial. The aim of this study is to determine the direct effect of ARB on diabetic nephropathy. Thirty-four type 2 diabetic patients with early kidney damage were divided into two groups: losartan group (n=17) and control group (n=17). In losartan group, low dose (25mg) of losartan was administered once daily for a year. Blood pressure at home, blood pressure at office and urinary albumin/creatinine ratio (UACR) were measured before and during the treatment. After a 1-year observation, the increment of UACR was significantly smaller in losartan group than that in control group [-23.8+/-13.7 mg/gCr vs. 15.9+/-13.2mg/gCr, mean+/-S.E.M., P=0.0114]. Mean blood pressure levels did not change before and during the observation period both in losartan group and control group, though only systolic blood pressure at home decreased slightly but significantly. There were no significant differences in the levels of HbA(1c), fasting plasma glucose, total cholesterol, triglyceride and body mass index between the two groups. The observed decrease in UACR in the losartan-treated group might be attributed to a direct renoprotective action in addition to a subtle decrease in systolic blood pressure at home.