Recent evidence indicates a role for the renin-angiotensin system (RAS) in the pathogenesis of glomerular injury in diabetes. To further explore the RAS in diabetes, studies were conducted in nondiabetic control rats and in moderately hyperglycemic diabetic (DM) rats. In DM rats, both acute and chronic therapy with the specific angiotensin II (ANG II) receptor antagonist losartan did not affect glomerular hyperfiltration or hyperperfusion but selectively normalized the glomerular capillary hydraulic pressure and ultrafiltration coefficient. To determine the basis of intrarenal hemodynamic responsiveness to RAS inhibition, we conducted biochemical, molecular biological, and immunohistochemical studies to assess endogenous RAS activity. Values for plasma renin concentration and serum angiotensin-converting enzyme (ACE) activity in DM rats were normal. In contrast, intrarenal renin protein content, and renin and angiotensinogen mRNAs, were increased in DM rats, suggesting disproportionate activation of the intrarenal RAS. Total renal ACE activity was significantly reduced in DM rats, but immunohistochemical studies indicated redistribution of ACE in the diabetic kidney. Proximal tubule ACE activity was reduced, but ACE immunostaining intensity was enhanced in glomeruli and renal vasculature. Together, these observations indicate increased RAS activity in those sites (glomeruli and vasculature) most likely to regulate hemodynamic function, potentially explaining the prominent responses to pharmacological blockade of ANG II formation and/or action.