Reports of toxic effects on the kidney of lithium treatment emerged very soon after lithium therapy was introduced. Lithium-induced nephrogenic diabetes insipidus is usually self-limiting or not clinically dangerous. Some reports of irreversible chronic kidney disease and renal failure were difficult to attribute to lithium treatment since chronic kidney disease and renal failure exist in the population at large. In recent years, large-scale epidemiological studies have convincingly shown that lithium treatment elevates the risk of chronic kidney disease and renal failure. Most patients do not experience renal side effects. The most common side effect of polyuria only weakly predicts increasing creatinine or reduced kidney function. Among those patients who do experience decrease in creatinine clearance, some may require continuation of lithium treatment even as their creatinine increases. Other patients may be able to switch to a different mood stabilizer medication, but kidney function may continue to deteriorate even after lithium cessation. Most, but not all, evidence today recommends using a lower lithium plasma level target for long-term maintenance and thereby reducing risks of severe nephrotoxicity.