Diabetes is the leading cause of end stage renal disease, resulting in a significant health care burden and loss of economic productivity by affected individuals. As current therapies for progression of diabetic nephropathy (DN) are only moderately successful, identification of underlying mechanisms of disease is essential in order to develop more effective therapies. We showed previously that inhibition of arginase using S-(2-boronoethyl)-L-cysteine (BEC) or genetic deficiency of the arginase-2 isozyme was protective against key features of nephropathy in diabetic mouse models. However, those studies did not determine whether all markers of DN were dependent only on arginase-2 expression. The objective of this study was to identify features of DN that are associated specifically with expression of arginase-1 or -2. Elevated urinary albumin excretion rate and plasma urea levels, increases in renal fibronectin mRNA levels, and decreased renal medullary blood flow were associated almost completely and specifically with arginase-2 expression, indicating that arginase-2 selectively mediates major aspects of diabetic renal injury. However, increases in renal macrophage infiltration and renal TNF-α mRNA levels occurred independently of arginase-2 expression but were almost entirely abolished by treatment with BEC, indicating a distinct role for arginase-1. We therefore generated mice with a macrophage-specific deletion of arginase-1 (CD11b^Cre/Arg1^fl/fl). CD11b^Cre/Arg1^fl/fl mice had significantly reduced macrophage infiltration, but had no effect on albuminurea compared to Arg1^fl/fl mice after 12 weeks of streptozotocin-induced diabetes. These results indicate that selective inhibition of arginase-2 would be effective in preventing or ameliorating major features of diabetic renal injury.