The hepatocyte nuclear factor-1beta (HNF-1beta) transcription factor controls endoderm development. Human mutations cause early-onset diabetes mellitus and have recently been associated with dysplastic, hypoplastic, and glomerulocystic kidneys. A new kindred with this "renal cysts and diabetes" syndrome is described, and nephrogenic HNF-1beta expression is defined. The proband had congenital cystic kidneys: over the next 12 yr, his renal function was impaired, but he was normoglycemic. His mother developed diabetes during pregnancy: renal ultrasonography at age 24 yr was normal, but she subsequently developed cysts. Both subjects have a heterozygous frameshift mutation in HNF-1beta that results from a 1-bp insertion in exon 5 (Y352fsinsA). When reverse-transcription PCR and in situ hybridization were used, HNF-1beta mRNA was detected in normal human metanephroi, with the highest levels of transcripts localized to fetal medullary and cortical collecting ducts and low levels of expression in nephrogenic cortex mesenchyme, primitive nephron tubules, and immature glomeruli. These results constitute the first demonstration of HNF-1beta expression during human nephrogenesis and emphasize a disease spectrum associated with HNF-1beta mutation.