The cytokine transforming growth factor (TGF)-β1 plays a central role in diabetic nephropathy (DN) with data implicating the miRNA (miR) miR-21 as a key modulator of its prosclerotic actions. In the present study, we demonstrate data indicating that miR-21 up-regulation positively correlates with the severity of fibrosis and rate of decline in renal function in human DN. Furthermore, concomitant analyses of various models of fibrotic renal disease and experimental DN, confirm tubular miR-21 up-regulation. The fibrotic changes associated with increased miR-21 levels are proposed to include the regulation of TGF-β1-mediated mothers against decapentaplegic homolog 3 (SMAD3)- and phosphoinositide 3-kinase (PI3K)-dependent signalling pathways via co-ordinated repression of mothers against decapentaplegic homolog 7 (SMAD7) and phosphatase and tensin homologue (PTEN) respectively. This represents a previously uncharacterized interaction axis between miR-21 and PTEN–SMAD7. Targeting of these proteins by miR-21 resulted in de-repression of the respective pathways as reflected by increases in SMAD3 and V-Akt murine thymoma viral oncogene homolog 1 (AKT) phosphorylation. Many of the changes typically induced by TGF-β1, including phosphorylation of signalling mediators, were further enhanced by miR-21. Collectively, these data present a unified model for a key role for miR-21 in the regulation of renal tubular extracellular matrix (ECM) synthesis and accumulation and provide important insights into the molecular pathways implicated in the progression of DN.