Tonicity-responsive enhancer binding protein (TonEBP) plays a key role in protecting renal cells from hypertonic stress by stimulating transcription of specific genes. Under hypertonic conditions, TonEBP activity is enhanced via increased nuclear translocation, transactivation, and abundance. It was reported previously that hypertonicity exerted a dual, time-dependent effect on vasopressin-inducible aquaporin-2 (AQP2) expression in immortalized mouse collecting duct principal cells (mpkCCDcl4). Whereas AQP2 abundance decreased after 3 h of hyperosmotic challenge, it increased after 24 h of hypertonic challenge. This study investigated the role that TonEBP may play in these events by subjecting mpkCCDcl4 cells to 3 or 24 h of hypertonic challenge. Hypertonic challenge increased TonEBP mRNA and protein content and enhanced TonEBP activity as illustrated by both increased TonEBP-dependent luciferase activity and mRNA expression of several genes that are targeted by TonEBP. Irrespective of the absence or presence of vasopressin, decreased TonEBP activity in cells that were transfected with either TonEBP small interfering RNA or an inhibitory form of TonEBP strongly reduced AQP2 mRNA and protein content under iso-osmotic conditions and blunted the increase of AQP2 abundance that was induced after 24 h of hypertonic challenge. Conversely, decreased TonEBP activity did not significantly alter reduced expression of AQP2 mRNA that was induced by 3 h of hypertonic challenge. Mutation of a TonE enhancer element located 489 bp upstream of the AQP2 transcriptional start site abolished the hypertonicity-induced increase of luciferase activity in cells that expressed AQP2 promoter-luciferase plasmid constructs, indicating that TonEBP influences AQP2 transcriptional activity at least partially by acting directly on the AQP2 promoter. These findings demonstrate that in collecting duct principal cells, TonEBP plays a central role in regulating AQP2 expression by enhancing AQP2 gene transcription.