To observe the curative effect of Sanhuang Yishen Granule in treating diabetic nephropathy patients in stage IV who have the syndromes of dual deficiency of qi and yin and blood stasis and dampness. Methods: A multi-center randomized controlled study was conducted on patients with diabetic nephropathy in phase IV. Sanhuang Yishen Granule and Irbesartan placebo were given to the treatment group and Sanhuang Yishen Granule and Irbesartan to the control group. A total of 56 cases were divided as 27 in the treatment group and 29 in the comparison group. Results: TCM syndromes total score in both of the two groups were improved and the treatment group performed better than the control group (P<0.01). The 24 hour urine protein quantity in the treatment group was significantly improved (P<0.05), with the comprehensive evaluation of curative effect rate of 92.6%, which was also higher than that of the control group (P<0.01). No adverse reaction was found in both groups. The comprehensive curative effect of the treatment group is better than the control group. Conclusion: By replenishing qi and nourishing yin and removing blood stasis and discharging turbidity, Sanhuang Yishen Granule can relieve clinical symptoms, reduce the TCM syndrome scores and the 24 hour urine protein quantity.