Chronic kidney disease (CKD) associated with diabetes mellitus (DM) (known as diabetic kidney disease, DKD) is a serious and growing healthcare problem worldwide. In DM patients, DKD is generally diagnosed based on the presence of albuminuria and a reduced glomerular filtration rate. Diagnosis rarely includes an invasive kidney biopsy, although DKD has some characteristic histological features, and kidney fibrosis and nephron loss cause disease progression that eventually ends in kidney failure. Alternative sensitive and reliable non-invasive biomarkers are needed for DKD (and CKD in general) to improve timely diagnosis and aid disease monitoring without the need for a kidney biopsy. Such biomarkers may also serve as endpoints in clinical trials of new treatments. Non-invasive magnetic resonance imaging (MRI), particularly multiparametric MRI, may achieve these goals. In this article, we review emerging data on MRI techniques and their scientific, clinical, and economic value in DKD/CKD for diagnosis, assessment of disease pathogenesis and progression, and as potential biomarkers for clinical trial use that may also increase our understanding of the efficacy and mode(s) of action of potential DKD therapeutic interventions. We also consider how multi-site MRI studies are conducted and the challenges that should be addressed to increase wider application of MRI in DKD.