The metanephric, or definitive, kidney forms as a result of inductive processes between tissues of two distinct embryologic origins, the metanephric mesenchymal blastema and the ureteric bud. After inductive signalling between these primordial tissues, mesenchymal cells aggregate next to the branching ureteric bud tip, convert to epithelial cells and differentiate into the diverse cell populations of the nephron. The ureteric bud enters branching morphogenesis and gives rise to the collecting duct system. Nephrogenesis has become a target system by which to study developmental processes including embryonic inductive interactions, mesenchyme-to-epithelium conversion, cell lineage pathways, epithelial cell polarization, branching morphogenesis and spatio-temporal expression of transcription factors. This review summarizes data on cellular and extracellular events during epithelial metanephrogenesis.