We examined whether defects in glomerular size selectivity in type 2 diabetes (T2D) associated with progressive kidney disease. Glomerular filtration rate (GFR) and fractional clearances of dextrans of graded sizes were measured in 185 Pima Indians. The permselectivity model that best fit the dextran sieving data represented the glomerular capillary as being perforated by small restrictive pores and a parallel population of larger non-restrictive pores characterized by ωo, the fraction of total filtrate volume passing through this shunt. Hazard ratio (HR) for kidney failure was expressed per 1 standard deviation (SD) increase of ωo by Cox regression after adjusting for age, sex, mean arterial pressure, HbA1c, GFR, and the urine albumin-to-creatinine ratio (ACR). Baseline mean age (±SD) was 43±10 years, HbA1c 8.9±2.5%, GFR 147±46 ml/min, and median (IQR) ACR 41 (11-230) mg/g. During a median follow-up of 17.7 years, 70 participants developed kidney failure. After adjustment, each 1 SD increment in ωo was associated with a higher risk of kidney failure (HR=1.49, 95% CI 1.13, 1.96). Enhanced transglomerular passage of test macromolecules associated with progression to kidney failure, independent of albuminuria and GFR, suggesting that mechanisms associated with impaired glomerular permselectivity are important determinants of progressive kidney disease.