N-methyl-D-aspartate (NMDA) receptor activation in rat kidney reduces renal perfusion and ultrafiltration. Hypoperfusion-induced ischemia is the most frequent cause of functional insufficiency in the endotoxemic kidney. Here, we used non-hypotensive rat model of lipopolysaccharide-induced endotoxemia to examine whether NMDA receptor hyperfunction contributes to acute kidney injury. Lipopolysaccharide-induced renal damage via increased enzymuria and hemodynamic impairments were ameliorated by co-treatment with the NMDA receptor blocker, MK-801. The NMDA receptor NR1 subunit in the rat kidney mainly co-localized with serine racemase, an enzyme responsible for synthesizing the NMDA receptor co-agonist, D-serine. The NMDA receptor hyperfunction in lipopolysaccharide-treated kidneys was demonstrated by NR1 and serine racemase upregulation, particularly in renal tubules, and by increased D-serine levels. Lipopolysaccharide also induced cell damage in cultured tubular cell lines and primary rat proximal tubular cells. This damage was mitigated by MK-801 and by small interfering RNA targeting NR1. Lipopolysaccharide increased cytokine release in tubular cell lines via toll-like receptor 4. The release of interleukin-1β from these cells are the most abundant. An interleukin-1 receptor antagonist not only attenuated cell death but also abolished lipopolysaccharide-induced NR1 and serine racemase upregulation and increases in D-serine secretion, suggesting that interleukin-1β-mediated NMDA receptor hyperfunction participates in lipopolysaccharide-induced tubular damage. The results of this study indicate NMDA receptor hyperfunction via cytokine effect participates in lipopolysaccharide-induced renal insufficiency. Blockade of NMDA receptors may represent a promising therapeutic strategy for the treatment of sepsis-associated renal failure.