Background and objective: Incidence and prevalence of Diabetes in developing countries like India is on the rise. Diabetic nephropathy is one of the commonest causes of proteinuria associated with renal disorder and creates a sound socio-medical and pharmacoeconomic basis for healthcare decision making. The principal aim of this research is to facilitate rational use of drugs in the patient population suffering from Diabetic nephropathy. Materials and methods: We collected the data from 313 Diabetic patients who got admitted in the Department of Nephrology from June 2009 to December 2010 with proteinuria on urine analysis and the drug utilization pattern was analyzed statistically. Result: Based on our observation, Renin Angiotensin Aldosterone System (RAAS) inhibitors like ACEIs and ARBs are the most frequently used agents in case of Diabetic nephropathy with proteinuria besides the anti diabetic therapy. Among those, ARBs are more commonly prescribed than ACEIs. Conclusion: Early detection of nephropathy and the use of reno-protective agents like ARBs and or ACE inhibitors, may delay the progression of renal disease in Diabetic patients besides reducing the cardiovascular morbidity and mortality.