Aims/hypothesis. The predictive value of glomerular structure on progression of renal disease was examined in patients with Type II (non-insulin-dependent) diabetes and microalbuminuria (urinary albumin-to-creatinine ratio = 30–299 mg/g). Methods. Kidney biopsy specimens were obtained from 16 diabetic Pima Indians (6 men, 10 women). Progression of renal disease was assessed by measuring urinary albumin excretion 4 years after the biopsy (UAE_{4 years}) and by computing the change in urinary albumin excretion during the study (Δ UAE). Results. At baseline, the duration of diabetes averaged 13.3 years (range = 4.0–23.8 years) and the mean glomerular filtration rate was 159 ml · min^–1· 1.73m^–2 (range = 98 – 239 ml · min^–1· 1.73m^–2). Median urinary albumin excretion was 67 mg/g (range = 25–136 mg/g) and it increased to 625 mg/g (range = 9–13471 mg/g) after 4 years; 10 subjects (63 %; 4 men, 6 women) developed macroalbuminuria (urinary albumin-to-creatinine ratio ≥ 300 mg/g). Neither mean arterial pressure nor HbA_{1 c} changed substantially during follow-up. Among the glomerular morphologic characteristics, the number of visceral epithelial cells, or podocytes, per glomerulus was the strongest predictor of renal disease progression (UAE_{4 years}, r = –0.49, p = 0.05; ΔUAE, r = –0.57, p = 0.02), with fewer cells predicting more rapid progression. Glomerular basement membrane thickness did not predict progression (UAE_{4 years}, r = 0.11, p = 0.67; ΔUAE, r = 0.09, p = 0.73) and mesangial volume fraction had only a modest effect (UAE_{4 years,} r = 0.42, p = 0.11; ΔUAE, r = 0.48, p = 0.06). Conclusion/interpretation. Whether lower epithelial cell number per glomerulus among those that progressed was due to cellular destruction, a reduced complement of epithelial cells, or both is uncertain. Nevertheless, these findings suggest that podocytes play an important part in the development and progression of diabetic renal disease. [Diabetologia (1999) 42: 1341–1344]