Diabetic kidney disease (DKD) is one of the most common and severe microvascular complications of diabetes mellitus (DM), and has become the leading cause of end-stage renal disease (ESRD) worldwide. Although the exact pathogenic mechanism of DKD is still unclear, programmed cell death has been demonstrated to participate in the occurrence and development of diabetic kidney injury, including ferroptosis. Ferroptosis, an iron-dependent form of cell death driven by lipid peroxidation, has been identified to play a vital role in the development and therapeutic responses of a variety of kidney diseases, such as acute kidney injury (AKI), renal cell carcinoma and DKD. In the past two years, ferroptosis has been well investigated in DKD patients and animal models, but the specific mechanisms and therapeutic effects have not been fully revealed. Herein, we reviewed the regulatory mechanisms of ferroptosis, summarized the recent findings associated with the involvement of ferroptosis in DKD, and discussed the potential of ferroptosis as a promising target for DKD treatment, thereby providing a valuable reference for basic study and clinical therapy of DKD.