This study examined the effect of long-term control of hyperglycemia with a new sodium glucose cotransporter 2 inhibitor, luseogliflozin, given alone or in combination with lisinopril on the progression of renal injury in the T2DN rat model of type 2 diabetic nephropathy. Chronic treatment with luseogliflozin (10 mg/kg/day) produced a sustained increase in glucose excretion and normalized blood glucose and glycosylated hemoglobin levels to the same level as seen in the rats treated with insulin. It had no effect on blood pressure. In contrast, lisinopril (10 mg/kg/day) reduced mean blood pressure from 140 to 113 mmHg. Combination therapy significantly reduced blood pressure more than that seen in the rats treated with lisinopril. T2DN rats treated with vehicle exhibited progressive proteinuria, a decline in glomerular filtration rate (GFR), focal glomerulosclerosis, renal fibrosis, and tubular necrosis. Control of hyperglycemia with luseogliflozin prevented the fall in GFR and reduced the degree of glomerular injury, renal fibrosis, and tubular necrosis. In contrast, control of hyperglycemia with insulin had no effect on the progression of renal disease in T2DN rats. Reducing blood pressure with lisinopril prevented the fall in GFR and reduced proteinuria and the degree of glomerular injury and tubular necrosis. Combination therapy reduced the degree of glomerular injury, renal fibrosis, and tubular necrosis to a greater extent than administration of either drug alone. These results suggest that control of hyperglycemia with luseogliflozin slows the progression of diabetic nephropathy more than that seen with insulin, and combination therapy is more renoprotective than administration of either compound alone.