The polycystic kidney diseases (PKD) are a group of genetic disorders causing renal failure and death from infancy to adulthood. Arginine vasopressin (AVP) V2 receptor antagonists inhibit cystogenesis in animal models of cystic kidney diseases, presumably by downregulating cAMP signaling, cell proliferation, and chloride-driven fluid secretion. For confirmation that the protective effect of these drugs is due to antagonism of AVP, PCK (Pkhd1(-/-)) and Brattleboro (AVP(-/-)) rats were crossed to generate rats with PKD and varying amounts of AVP. At 10 and 20 weeks of age, PCK AVP(-/-) rats had lower renal cAMP and almost complete inhibition of cystogenesis compared with PCK AVP(+/+) and PCK AVP(+/-) rats. The V2 receptor agonist 1-deamino-8-d-arginine vasopressin increased renal cAMP and recovered the full cystic phenotype of PCK AVP(-/-) rats and aggravated the cystic disease of PCK AVP(+/+) rats but did not induce cystic changes in wild-type rats. These observations indicate that AVP is a powerful modulator of cystogenesis and provide further support for clinical trials of V2 receptor antagonists in PKD.