Background: Neutrophil–Gelatinase associated Lipocalin is a 25-kDa lipocalin glycoprotein. It's expressed in low amounts in numerous human tissues and induced in the kidney after ischemia or nephrotoxic injury. It predicted diabetics' early renal impairment. Aim: To evaluate the accuracy of Neutrophil–Gelatinase associated Lipocalin in diagnosis of diabetic kidney disease in Type 2 diabetes mellitus. Subject and Methods: This cross-sectional study was conducted on 160 participants at internal medicine outpatient clinic of Aswan University hospital. Results: There was statistically significant difference between the three studied groups regarding disease duration, per glucose profile, fasting blood sugar, 2 hour-post prandial sugar and HbA1c. Also, there was significant difference between the three studied groups regarding per lipid profile parameters. As well, there was significant difference between groups regarding per renal function tests. It was found that neutrophil–gelatinase associated lipocalin can significantly predict diabetic kidney disease at a cutoff of 56 ng/ml. Conclusion: Tubular injury may precede glomerular injury in diabetic patients and as neutrophil–gelatinase associated lipocalin is a tubular marker it is superior to albumin/Creatinine ratio as an early predictor of diabetic kidney disease in Type 2 diabetic patients as there was significant difference between non- albuminuria diabetic patient and non-albuminuria healthy individuals.