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Diabetic nephropathy (DN) is the major cause of renal disease that affects 40% of patients with diabetes. DN is characterized by the pathological urine albumin excretion rate (UAER), diabetic glomerular lesions, and loss of glomerular filtration rate (GFR). Several studies have found strong association of animal protein with the glucagon activation, insulin resistance, proteinuria, microalbuminuria, and progression of renal disease in diabetic patients. Vegan diet that excludes all animal foods such as meat (including fish, shellfish, and insects), dairy, eggs, and honey, as well as products such as leather has been found significantly beneficial on enhancing insulin sensitivity, reducing glucagon activation and incidence of chronic kidney disease (CKD), and slow the progression of DN. Other studies have suggested that avoiding animal food and shifting the source of dietary protein from animal-derived to plant-based products may be a better dietary approach than dietary protein restriction to reduce kidney disease and cardiovascular disease (CVD), particularly in CKD and diabetes patients with profound insulin resistance. Based on the literature search conducted in this study we concluded that the vegan diet is beneficial in patients with diabetes and CKD to slow the progression of the DN and renal failure. However, additional interventional studies in humans are needed to understand the mechanisms underlying the increased insulin sensitivity by vegan diets and further studies of efficacy and safety of vegan diets in patients with diabetes and DN are recommended.