Background: diabetic nephropathy (DN) is a serious complication of diabetes mellitus and a common cause for end stage renal disease. Autophagy has a defensive role against kidney damage caused by hyperglycemia. The mesenchymal stem cells (MSCs) derived exosomes are currently considered as a new promising therapy in chronic renal injury. However, the renal protective mechanism of exosomes on DN has not been completely understood. We examined the potential role of MSCs derived exosomes in enhancement of autophagy activity and its effect on DN. In our study we used five groups of rats; control, DN, DN treated with exosomes, DN treated with 3-methyladenine (3-MA) and chloroquine (inhibitors of autophagy) and DN treated with 3-methyladenine (3-MA) and chloroquine and exosomes groups. We assessed renal functions, morphology and fibrosis. Moreover, autophagy markers; mTOR, Beclin-1, light chain-3 (LC3-II), and LC3-II/LC3-I ratio were detected. Additionally, electron microscopy was used for detection of autophagosomes. Results: Exosomes markedly improved the renal functions and showed histological restoration of renal tissues with significant increase in LC3 and Beclin-1 besides the significant decrease in mTOR and fibrotic markers expression in renal tissue. All previous effects were partially abolished by the autophagy inhibitor, chloroquine and 3-MA. Conclusions: we conclude that autophagy induction by exosomes could attenuate DN in a rat model of streptozotocin-induced diabetes mellitus.