Lipotoxicity is characterized by the ectopic accumulation of lipids in organs different from adipose tissue. Lipotoxicity is mainly associated with dysfunctional signaling and insulin resistance response in non-adipose tissue such as myocardium, pancreas, skeletal muscle, liver, and kidney. Serum lipid abnormalities and renal ectopic lipid accumulation have been associated with the development of kidney diseases, in particular diabetic nephropathy. Chronic hyperinsulinemia, often seen in type 2 diabetes, plays a crucial role in blood and liver lipid metabolism abnormalities, thus resulting in increased non-esterified fatty acids (NEFA). Excessive lipid accumulation alters cellular homeostasis and activates lipogenic and glycogenic cell-signaling pathways. Recent evidences indicate that both quantity and quality of lipids are involved in renal damage associated to lipotoxicity by activating inflammation, oxidative stress, mitochondrial dysfunction, and cell-death. The pathological effects of lipotoxicity have been observed in renal cells, thus promoting podocyte injury, tubular damage, mesangial proliferation, endothelial activation, and formation of macrophage-derived foam cells. Therefore, this review examines the recent preclinical and clinical research about the potentially harmful effects of lipids in the kidney, metabolic markers associated with these mechanisms, major signaling pathways affected, the causes of excessive lipid accumulation, and the types of lipids involved, as well as offers a comprehensive update of therapeutic strategies targeting lipotoxicity.