Development of the kidney serves as a paradigm to understand the mechanisms underlying the formation of an organ. The first sign of kidney development is the interaction between two tissues derived from the intermediate mesoderm, the metanephrogenic mesenchyme and the nephric duct. Many of the genes that play a crucial role in early kidney development, such as Pax2, Eya1, Six1, Six2, Sall1, Foxc1, Wt1, and the Hox11 genes, are expressed in the mesenchyme and encode transcription factors that--with few exceptions--are involved in regulation of the Gdnf gene. Moreover, mutations in a number of these genes in humans are associated with kidney diseases. Interestingly, many of the components regulating early kidney development are conserved throughout evolution and are also involved in eye and muscle formation in mammals, as well as in eye development in Drosophila. Genetic and biochemical studies in Drosophila and mice indicate that these genes and their respective products act in a complex network of interdependencies and positive and negative feedback loops. Genetic experiments have allowed us to begin to characterize the complex interactions between the individual components, but it will require additional biochemical and functional experiments to eventually understand the molecular functions of each of the participating proteins.