Despite the emerging importance of fibroblast growth factor 21 (FGF21) as a metabolic hormone regulating energy balance, its direct effects on renal function remain unexplored. FGF21 was injected ip daily for 12 weeks into db/db mice. Compared with control vehicle injection, FGF21 treatment significantly improved lipid profiles and insulin resistance and resulted in significantly higher serum adiponectin levels. In contrast, serum insulin and 8-isoprostane levels were significantly decreased. Interestingly, FGF21 and its receptor components in the kidneys were found to be significantly up-regulated in db/db mice, which suggests an FGF21-resistant state. FGF21 treatment significantly down-regulated FGF21 receptor components and activated ERK phosphorylation. FGF21 administration also markedly decreased urinary albumin excretion and mesangial expansion and suppressed profibrotic molecule synthesis. Furthermore, FGF21 improved renal lipid metabolism and oxidative stress injury. In cultured renal cells, FGF21 was mainly expressed in mesangial cells, and knockdown of FGF21 expression by stealth small interfering RNA further aggravated high-glucose-induced profibrotic cytokine synthesis in mesangial cells. Our results suggest that FGF21 improves insulin resistance and protects against renal injury through both improvement of systemic metabolic alterations and antifibrotic effects in type 2 diabetic nephropathy. Targeting FGF21 could therefore provide a potential candidate approach for a therapeutic strategy in type 2 diabetic nephropathy.