The contribution of DNA methylation to diabetic nephropathy, especially the effect on podocyte integrity, is not clarified. Here we found that albuminuria in a db/db mouse model was markedly attenuated after treatment with a DNA methylation inhibitor. This was accompanied by alleviation of glomerular hypertrophy, mesangial matrix expansion, and podocyte injury. The expression of DNA methyltransferase 1 (Dnmt1), nuclear factor Sp1, and nuclear factor kappa B (NFκB)-p65 markedly increased in podocytes in vivo and in vitro under the diabetic state. The increased expression of Dnmt1 was attenuated after treatment with 5-azacytidine or 5-aza-2'-deoxycytidine or Dnmt1 knockdown, accompanied by restored decreased podocyte slit diaphragm proteins resulting from hypermethylation and improved podocyte motility. Further studies found that increased Sp1 and NFκB-p65 interacted in the nucleus of podocytes incubated with high glucose, and Sp1 bound to the Dnmt1 promoter region. The involvement of the Sp1/NFκB-p65 complex in Dnmt1 regulation was confirmed by the observation that Sp1 knockdown using mithramycin A or siRNA decreased Dnmt1 protein levels. The luciferase reporter assay further indicated that Dnmt1 was a direct target of Sp1. Thus, inhibition of DNA methylation may be a new therapeutic avenue for treating diabetic nephropathy. Hence, the Sp1/NFκB p65-Dnmt1 pathway may be exploited as a therapeutic target for protecting against podocyte injury in diabetic nephropathy.