Current treatments for diabetic nephropathy (DN) only result in slowing its progression, thus highlighting a need to identify novel targets. Increased production of reactive oxygen species (ROS) is considered a key downstream pathway of end-organ injury with increasing data implicating both mitochondrial and cytosolic sources of ROS. The enzyme, NADPH oxidase, generates ROS in the kidney and has been implicated in the activation of protein kinase C (PKC), in the pathogenesis of DN, but the link between PKC and Nox-derived ROS has not been evaluated in detail in vivo. In this study, global deletion of a NADPH-oxidase isoform, Nox4, was examined in mice with streptozotocin-induced diabetes (C57Bl6/J) in order to evaluate the effects of Nox4 deletion, not only on renal structure and function but also on the PKC pathway and downstream events. Nox4 deletion attenuated diabetes-associated increases in albuminuria, glomerulosclerosis, and extracellular matrix accumulation. Lack of Nox4 resulted in a decrease in diabetes-induced renal cortical ROS derived from the mitochondria and the cytosol, urinary isoprostanes, and PKC activity. Immunostaining of renal cortex revealed that major isoforms of PKC, PKC-α and PKC-β1, were increased with diabetes and normalized by Nox4 deletion. Downregulation of the PKC pathway was observed in tandem with reduced expression of vascular endothelial growth factor (VEGF), transforming growth factor (TGF)-β1 and restoration of the podocyte slit pore protein nephrin. This study suggests that deletion of Nox4 may alleviate renal injury via PKC-dependent mechanisms, further strengthening the view that Nox4 is a suitable target for renoprotection in diabetes.