Background/Aims: A sodium-glucose co-transporter-2 inhibitor dapagliflozin is widely used for lowering blood glucose and its usage is limited in type 2 diabetes mellitus patients with moderate renal impairment. As its effect on kidney function is discrepant and complicated, the aim of this study is to determine the effect of dapagliflozin on the progression of diabetic nephropathy and related mechanisms. Methods: Twelve-week-old male C57BL/6 wild-type and db/db mice were treated with vehicle or 1 mg/kg dapagliflozin for 12 weeks. Body weight, blood glucose, insulin tolerance, glucose tolerance, pyruvate tolerance and 24-hour urine were measured every 4 weeks. At 24 weeks of age, renal function was evaluated by blood urea nitrogen level, creatinine clearance, urine output, urinary albumin excretion, Periodic Acid-Schiff staining, Masson’s trichrome staining and electron microscopy. Changes in insulin signaling and gluconeogenic key regulatory enzymes were detected using Western blot analysis. Results: Dapagliflozin did not alleviate but instead aggravated diabetic nephropathy manifesting as increased levels of microalbuminuria, blood urea nitrogen, and glomerular and tubular damage in db/db mice. Despite adequate glycemic control by dapagliflozin, urinary glucose excretion increased after administration before 24 weeks of age and was likely associated with renal impairment. Increased urinary glucose excretion was mainly derived from the disturbance of glucose homeostasis with elevated hepatic and renal gluconeogenesis induced by dapagliflozin. Although it had no effect on insulin sensitivity and glucose tolerance, dapagliflozin further induced the expression of gluconeogenic key rate-limiting enzymes through increasing the expression levels of FoxO1 in the kidney and liver. Conclusion: These experimental results indicate that dapagliflozin aggravates diabetes mellitus-induced kidney injury, mostly through increasing gluconeogenesis.