The maintenance of water homeostasis under pathological conditions is mediated by the aquaporin-4 (AQP4) channel in astrocytes. To clarify the transcriptional regulation for AQP4 under conditions of astrocytic swelling, we examined the role of nuclear factor of activated T cells 5 (NFAT5). We evaluated NFAT5 expression patterns after the induction of brain edema and following excitotoxic neuronal death by kainic acid injection. In injured hippocampi, NFAT5 expression increased in astrocytes from 12 h to 3 days post-injection. AQP4 was redistributed from perivascular to whole-cell processes in astrocytes. NFAT5 and AQP4 expression increased under astrocytic swelling induced by ammonia treatment, and NFAT5-targeted silencing significantly reduced AQP4 expression. The promoter region required for NFAT5 transcriptional activation was located between -49 and -38 bp of rat AQP4. The amount of NFAT5 bound to the promoter of AQP4 was increased in response to ammonia. Our data demonstrate that NFAT5 is necessary for the transcriptional regulation of AQP4 expression and for local astrocyte swelling with accompanying restriction of the neuropil extracellular space in vivo.