Growing evidence supports the role of the gut-kidney axis and persistent mitochondrial dysfunction in the pathogenesis of diabetic nephropathy (DN). Ulinastatin (UTI) has a potent anti-inflammatory effect, protecting the kidney and the gut barrier in sepsis, but its effect on DN has yet to be investigated. This study aimed to assess the potential mitigating effect of UTI on DN and investigate the possible involvement of gut-kidney axis and mitochondrial homeostasis in this effect. Forty male Wistar rats were divided equally into four groups: normal; UTI-treated control; untreated DN; and UTI-treated DN. At the end of the experiment, UTI ameliorated DN by modulating the gut-kidney axis as it improved serum and urinary creatinine, urine volume, creatinine clearance, blood urea nitrogen, urinary albumin, intestinal morphology including villus height, crypt depth, and number of goblet cells, with upregulating the expression of intestinal tight-junction protein claudin-1, and counteracting kidney changes as indicated by significantly decreasing glomerular tuft area and periglomerular and peritubular collagen deposition. In addition, it significantly reduced intestinal and renal nuclear factor kappa B (NF-κB), serum Complement 5a (C5a), renal monocyte chemoattractant protein-1 (MCP-1), renal intercellular adhesion molecule 1 (ICAM1), and renal signal transducer and activator of transcription 3 (STAT3), mitochondrial dynamin related protein 1 (Drp1), mitochondrial fission 1 protein (FIS1), mitochondrial reactive oxygen species (ROS), renal hydrogen peroxide (H2O2), and 8-hydroxy-2'-deoxyguanosine (8-OHdG) levels. Furthermore, it significantly increased serum short chain fatty acids (SCFAs), and mitochondrial ATP levels and mitochondrial transmembrane potential. Moreover, there were significant correlations between measured markers of gut components of the gut-kidney axis and renal function tests in UTI-treated DN group. In conclusion, UTI has a promising therapeutic effect on DN by modulating the gut-kidney axis and improving renal mitochondrial dynamics and redox equilibrium.