The aim of the present study was to investigate expression levels of circular RNA HIPK3 (circHIPK3) in mice with diabetic nephropathy (DN) and the role of circHIPK3 in rat mesangial cells (MCs). Quantitative real-time polymerase chain reaction was performed to detect expression levels of circHIPK3, miR-185, cyclin D1, proliferating cell nuclear antigen (PCNA), transforming growth factor-β1 (TGF-β1), collagen Ⅰ (Col. Ⅰ), and fibronectin (FN) in mice with DN and rat mesangial cells. Luciferase assay was performed to investigate the binding sites of circHIPK3 and miR-185. Silencing cells of circHIPK3 and miR-185 were constructed using cell transfection assay. Our results revealed that the levels of 24-hour urinary albumin and urinary 8-hydroxy-2'-deoxyguanosine (8-OH-dG) from diabetic mice increased considerably. Up-regulation of circHIPK3 was observed in the renal tissues of mice with DN. Similarly, circHIPK3 expression in rat mesangial cells increased significantly in a microenvironment of high glucose. A loss-of-function experiment indicated that down-regulation of circHIPK3 inhibited cell proliferation and significantly decreased mRNA abundance of cyclin D1, PCNA, TGF-β1, Col. I, and FN in MCs. Luciferase assay demonstrated that circHIPK3 can specifically sponge miR-185, and silencing of miR-185 can reverse the effects of knocking down circHIPK3 on cell proliferation and mRNA abundance of cyclin D1, PCNA, TGF-β1, Col. I, and FN in MCs. Overall, circHIPK3 exhibits a promotive function in DN by sponging miR-185 and this evidence suggests that circHIPK3 might be a biomarker or therapeutic target for DN.