The role of vascular endothelial growth factor (VEGF) in renal fibrosis, tubular cyst formation, and glomerular diseases is incompletely understood. We studied a new conditional transgenic mouse system [Pax8-rtTA/(tetO)(7)VEGF], which allows increased tubular VEGF production in adult mice. The following pathology was observed. The interstitial changes consisted of a ubiquitous proliferation of peritubular capillaries and fibroblasts, followed by deposition of matrix leading to a unique kind of fibrosis, ie, healthy tubules amid a capillary-rich dense fibrotic tissue. In tubular segments with high expression of VEGF, cysts developed that were surrounded by a dense network of peritubular capillaries. The glomerular effects consisted of a proliferative enlargement of glomerular capillaries, followed by mesangial proliferation. This resulted in enlarged glomeruli with loss of the characteristic lobular structure. Capillaries became randomly embedded into mesangial nodules, losing their filtration surface. Serum VEGF levels were increased, whereas endogenous VEGF production by podocytes was down-regulated. Taken together, this study shows that systemic VEGF interferes with the intraglomerular cross-talk between podocytes and the endocapillary compartment. It suppresses VEGF secretion by podocytes but cannot compensate for the deficit. VEGF from podocytes induces a directional effect, attracting the capillaries to the lobular surface, a relevant mechanism to optimize filtration surface. Systemic VEGF lacks this effect, leading to severe deterioration in glomerular architecture, similar to that seen in diabetic nephropathy.