Epidermal growth factor (EGF) is a 53-amino acid polypetide which is a potent mitogen for cultured cells. The kidney has recently been shown to be a major site of synthesis for the EGF precursor. EGF infusions in sheep result in a diuresis and natriuresis despite a fall in GFR, suggesting a direct tubular effect. Using in vitro microperfusion of rabbit cortical collecting tubules (CC1s) at 370C, we examined the effect of EGF on the transepithelial voltage (VJ) and arginine vasopressin (AVP)-stimulated hydraulic conductivity (Lp). Pretreatment with peritubular EGF at concentrations from lo-8 to 10-12 M resulted in a 50% inhibition of both AVP-and 8-chlorophenythio-cyclic AMP-stimulated peak Lp. This effect was reversed by the protein kinase C inhibitor, staurosporine, but unaffected by indomethacin. CCTs with an initially negative V,, depolarized after exposure to bath EGF. 10-8 M EGF applied from the lumen had no effect on either Lp or Vt. Specific binding of 20 nM 125I-EGF to microdissected CCITs was also demonstrated. These results suggest that EGF can modulate both salt and water transport in the CCI via a receptor linked to protein kinase C activation.