Tubulointerstitial disease plays an important role in the pathophysiology of diabetic kidney disease. To determine whether biomarkers of tubular injury could predict renal outcome and mortality in patients with type 2 diabetes, we measured urinary levels of kidney injury molecule-1 (KIM-1) and glycoprotein non-metastatic melanoma B (Gpnmb), both normalized to the urinary creatinine, in 978 individuals from the Edinburgh Type 2 Diabetes Study. At baseline, 238 patients had an estimated glomerular filtration rate (eGFR) below 60 ml/min/1.73 m2 while 147 and 15 patients had microalbuminuria or overt proteinuria, respectively. Both the urine KIM-1 and Gpnmb to creatinine ratios correlated with the urinary albumin to creatinine ratio, the duration of diabetes, and the stringency of glycemic control but not with blood pressure or baseline eGFR. Higher ratios of each marker were associated with a faster decline in kidney function during 4 years of follow-up; however, this was not independent of the urinary albumin to creatinine ratio. Higher KIM-1, but not Gpnmb ratios were associated with an increased risk of mortality, but this association was no longer significant after adjustment for other risk factors, in particular albuminuria. Thus, tubular injury in persons with type 2 diabetes may contribute to the decline in kidney function; however, measuring the urinary concentration of these two tubular biomarkers does not confer additional prognostic information beyond established risk factors.