The objective was to examine prospectively the association between retinal microvascular signs and development of diabetic kidney disease (DKD) in Asian and White populations. We analysed two population-based cohorts, composing of 1,221 Asians (SEED) and 703 White (WESDR) adults with diabetes. Retinal microvascular signs at baseline included vascular caliber (arteriolar-CRAE, and venular-CRVE) and diabetic retinopathy (DR). Incident cases of DKD were identified after ~ 6-year. Incident cases were defined based on eGFR in SEED and proteinuria or history of renal dialysis in WESDR. The incidence of DKD were 11.8% in SEED and 14.0% in WESDR. Wider CRAE in SEED (OR = 1.58 [1.02, 2.45]) and wider CRVE (OR = 1.69 [1.02, 2.80)) in WESDR were associated with increased risk of DKD. Presence of DR was associated with an increased risk of DKD in both cohorts (SEED: OR = 1.91 [1.21, 3.01] in SEED, WESDR: OR = 1.99 [1.18, 3.35]). Adding DR and retinal vascular calibers in the model beyond traditional risk factors led to an improvement of predictive performance of DKD risk between 1.1 and 2.4%; and improved classification (NRI 3 between 9%). Microvascular changes in the retina are longitudinally associated with risk of DKD.