Background: Jowiseungki decoction (JSD) is a prescription commonly used for the treatment of diabetic complications or diabetic nephropathy (DN) in traditional medicine clinics. However, the underlying therapeutic mechanisms of JSD are still unclear. Methods: Streptozotocin (STZ)-induced DN mice were administered 100 and 500 mg/kg JSD for 4 weeks, and the therapeutic mechanisms and targets of JSD were analyzed by network pharmacology and gut microbiota analyses. Results: JSD significantly decreased the increase in food and water intake, urine volume, fasting blood glucose, serum glucose and triglyceride levels, and urinary albumin excretion. JSD administration significantly increased the decrease in insulin secretion and creatinine clearance and reduced the structural damage to the kidney tissues. Moreover, JSD administration significantly inhibited the expression of protein kinase C-alpha (PKC-α), transforming growth factor beta-1 (TGF-β1), α-smooth muscle actin (α-SMA), nuclear factor-κB (NF-κB), inducible nitric oxide synthase (iNOS), and cyclooxygenase-2 (COX-2) in the kidney tissues of DN mice, while it significantly increased the phosphorylation of insulin receptor substrate 1 (IRS-1), phosphatidylinositol-3-kinase (PI3K), and protein kinase B (Akt). In the network pharmacological analysis, JSD obviously influenced phosphatase binding, protein serine/threonine kinase, and mitogen-activated protein kinase (MAPK)-related signaling pathways. Our data suggest that JSD can improve symptoms in STZ-induced DN mice through the inhibition of kidney dysfunction, in particular, by regulating the PKCα/PI3K/Akt and NF-κB/α-SMA signaling pathways. Gut microbiota analysis can help to discover the pharmacomechanisms of the influence of JSD on bacterial diversity and flora structures in DN. Conclusion: JSD can improve the symptoms of DN, and the underlying mechanism of this effect is renal protection through the inhibition of fibrosis and inflammation. JSD can also change bacterial diversity and community structures in DN.