Introduction The aim of this study was to determine whether low-molecular-weight fucoidan (LMWF) can reduce TGF-β-mediated pathogenesis of tubulointerstitial fibrosis in diabetic nephropathy(DN) using in vitro and in vivo models. Methods LMWF was administered to diabetic rats at a daily dose of 100 mg/kg body weight by intragastric administration. Following 12 weeks of treatment, we measured body and kidney weight, blood glucose, blood pressure, creatinine and urea concentration in serum and urine, urine output, urinary osmolality, and urinary protein excretion. α-SMA, E-cadherin, fibronectin, TGF-β1, and CTGF were measured by Western blot to evaluate the level of epithelial-to-mesenchymal transition (EMT). Results 10 ng/ml TGF-β1 induced EMT and activated downstream pathways in HK2 cells. Treatment with LMWF significantly reversed EMT and dose-dependently inhibited accumulation of extracellular matrix proteins, including connective tissue growth factor and fibronectin. In type 1 and type 2 diabetic rat models, it was found that diabetes resulted in TGF-β signalling activation and increased expression of TGF-β downstream signals in the kidneys. LMWF significantly reduced blood urea nitrogen (BUN) and blood creatinine compared with the untreated type 1 diabetic group. LMWF also significantly reduced BUN and blood creatinine compared with the untreated type 2 diabetic group. Conclusion Our results demonstrate that LMWF treatment attenuated renal dysfunction and fibrogenesis in the kidneys of type 1 and type 2 diabetic rats. The present study suggests that LMWF may be developed as a candidate drug to prevent or inhibit fibrotic progression in DN.