Inducible NO synthase (iNOS) expression and peroxynitrite formation are significantly increased in diabetic vascular tissues. Transcription factor KLF5 activates iNOS gene transcription and is involved in vascular inflammatory injury and remodeling. However, mutual regulation between KLF5, iNOS and peroxynitrite in diabetic vascular inflammation, as well as the underlying mechanisms, remain largely unknown. In this study, we found a marked increase in KLF5 and iNOS expression in vascular smooth muscle cells (VSMC) of diabetic patients. High glucose-induced expression of KLF5 and iNOS was also observed in cultured mouse VSMCs. Further investigation showed that high glucose induced KLF5 nitration by iNOS-mediated peroxynitrite generation, and nitrated KITS increased its interaction with NF-kappa B p50 and thus cooperatively activated the expression of inflammatory cytokines TNF-alpha and IL-1 beta. Furthermore, we showed that the VSMC-specific knockout of KLF5 dramatically reduced inflammatory cytokine expression in the vascular tissues of diabetic mice. Moreover, 17 beta-estradiol (E2) inhibited high glucose-mediated effects in VSMCs, and in the response to E2, estrogen receptor (ER) a competed with KLF5 for binding to NF-kappa B p50, which in turn leads to the suppression of inflammatory gene expression in VSMCs. Together, the present findings were the first to show that KLF5 expression and nitration by, iNOS-mediated peroxynitrite are necessary for the induction of TNF-alpha and IL-1 beta expression in VSMCs of diabetic vascular tissues.