Lactate elevation is a well-characterized biomarker of mitochondrial dysfunction, but its role in diabetic kidney disease (DKD) is not well defined. Urine lactate was measured in patients with type 2 diabetes (T2D) in 3 cohorts (HUNT3, SMART2D, CRIC). Urine and plasma lactate were measured during euglycemic and hyperglycemic clamps in participants with type 1 diabetes (T1D). Patients in the HUNT3 cohort with DKD had elevated urine lactate levels compared with age- and sex-matched controls. In patients in the SMART2D and CRIC cohorts, the third tertile of urine lactate/creatinine was associated with more rapid estimated glomerular filtration rate decline, relative to first tertile. Patients with T1D demonstrated a strong association between glucose and lactate in both plasma and urine. Glucose-stimulated lactate likely derives in part from proximal tubular cells, since lactate production was attenuated with sodium-glucose cotransporter-2 (SGLT2) inhibition in kidney sections and in SGLT2-deficient mice. Several glycolytic genes were elevated in human diabetic proximal tubules. Lactate levels above 2.5 mM potently inhibited mitochondrial oxidative phosphorylation in human proximal tubule (HK2) cells. We conclude that increased lactate production under diabetic conditions can contribute to mitochondrial dysfunction and become a feed-forward component to DKD pathogenesis.