The prevalence and biological consequences of deleterious germline variants in urothelial cancer (UC) are not fully characterized. We performed whole-exome sequencing (WES) of germline DNA and 157 primary and metastatic tumors from 80 UC patients. We developed a computational framework for identifying putative deleterious germline variants (pDGVs) from WES data. Here, we show that UC patients harbor a high prevalence of pDGVs that truncate tumor suppressor proteins. Deepening somatic loss of heterozygosity in serial tumor samples is observed, suggesting a critical role for these pDGVs in tumor progression. Significant intra-patient heterogeneity in germline-somatic variant interactions results in divergent biological pathway alterations between primary and metastatic tumors. Our results characterize the spectrum of germline variants in UC and highlight their roles in shaping the natural history of the disease. These findings could have broad clinical implications for cancer patients.