Background: Diabetic nephropathy (DN) is a common finding in diabetic patients. Microalbuminuria is the earliest clinical evidence of DN. Early detection of microalbuminuria is very important; it allows timely interventions to prevent progression to macroalbuminuria and later end-stage renal disease (ESRD). Objectives: To determine the prevalence of microalbuminuria in diabetic patients and establish its association with traditional serum renal markers in assessment of incipient nephropathy. Methods: This cross-sectional study involved 213 participants with diabetes mellitus (DM) attending the diabetic clinic of MM Institute of MSR. Aim: We aimed to evaluate the levels of urine microalbumin, urine albumin creatinine ratio, plasma creatinine and glycosylated hemoglobin (HbA1c) among type 2 diabetic patients and assessed the correlation between microalbuminuria and plasma creatinine levels. Questionnaires were used to obtain participant data after obtaining written informed consent. Data collected included: age, sex, level of education, history of smoking and alcohol consumption, hypertension, body mass index, family history, and duration of DM. Morning spot urine samples were collected from each participant and blood drawn for analysis of other renal markers. Urine microalbumin was determined quantitatively using immunoturbidity assay (Microalbumin kit, Mindray). Results: Increase in mean level of plasma creatinine (138 μmol/L), urine microalbuminuria (310 mg/L), albumin creatinine ratio (52) and HbA1c (7.9%) was observed among type 2 DM patients. Moderate positive correlation was observed between microalbuminuria and urine albumin creatinine ratio (r = 0.643 P = 0.0008) and between urine albumin creatinine ratio and plasma creatinine (r = 0.645 P = 0.032). Conclusion: We concluded that type 2 DM patients who are at risk of developing renal impairment must be regularly monitored for microalbuminuria, urine albumin creatinine ratio, and HbA1c levels.