Diabetic kidney disease (DKD) is caused by a variety of processes. As a result, one biomarker is insufficient to represent the complete process. This study Evaluate the diagnostic value of serum kidney injury molecule-1(KIM-1) and cystatin C (CysC) as early biochemical markers of DKD and predictive their sensitivities and specificities as biomarkers of nephropathy in Iraqi type 2 diabetic (T2DM) patients. This cross-sectional study include 161 T2DM patients from Diabetes and Endocrinology Center at Merjan medical city in Babylon. Patients divided according to urinary albumin creatinine ratio(ACR) (Group1:ACR≤30mg/g,Group2:ACR>30mg/g). Random spot urine and fasting blood samples were taken from each patient and urinary ACR, blood glycated hemoglobin(HbA1c), and serum glucose, creatinine(SCr), lipid profile, CysC, KIM-1 were assayed, and the estimated glomerular filtration rat (eGFR) was calculated. When compared to the normoalbuminuric group, the DKD group had significantly greater prevalence of retinopathy, and significantly elevated HbA1c and total cholesterol values. Also had significantly greater serum levels of KIM-1 and CysC, and there is a significant (P-value< 0.01) positive correlation between them. In contrast, GFR was significantly higher in normoalbuminuric group and was significantly negatively correlated with both CysC and KIM-1. Multiple linear regression analysis, found that there were a significant positive association between CysC, KIM-1 and ACR. ROC analysis reveal that eGFR had the highest area under the curve(AUC=0.717), while SCr had the lowest AUC(0.556). In conclusion, Serum KIM-1 and CysC levels consider as early biomarker for DKD along with eGFR that consider the best diagnostic indicator of DKD, Additionally, there is a strong correlation between serum CysC and KIM-1 as well as other renal measures that indicate deteriorating kidney function.