The potential of pharmacogenomics has received widespread attention. The goals include identifying patients in whom a substantial response, or the absence of a response, to an individual drug can be anticipated; targets for drug therapy based on genetic polymorphisms involved in pathogenesis; and new opportunities for drug development. Diabetic (DM) nephropathy provides a useful model for exploring these issues since nephropathy occurs in 30-40% of patients, and diabetes is the most common cause of end-stage renal disease. Hyperglycemia and hypertension clearly contribute but do not explain fully the development of DM nephropathy. Family studies showed familial clustering in both type 1 and type 2 DM, with about a 3-fold increased risk in siblings if the proband had DM nephropathy. A search for candidate genes followed. The effectiveness of angiotensin converting enzyme (ACE) inhibitors and angiotensin receptor blockers in delaying the progression of DM nephropathy led to studies centering on polymorphisms of genes involving the renin-angiotensin system. These include the ACE, AGT, AT1R and renin genes. Despite an enormous number of studies, the results are still equivocal. An alternative approach is to use an intermediate phenotype to explore mechanisms. Our efforts have involved assessing the renal plasma flow response to ACE inhibition and angiotensin II receptor blockade in DM as an intermediate phenotype. The response provides a measure of angiotensin-dependent renal vasoconstriction, and thus, an index of intrarenal renin-angiotensin system activation, and shows promise as an effective tool in exploring the relation between gene polymorphisms and risk of disease.