The embryonic collecting duct epithelium of neonatal kidney undergoes profound functional changes during maturation. In its initial state as inductor epithelium it appears homogeneous, but differentiates into a heterogeneously composed collecting duct epithelium consisting of principal and intercalated cells. The mechanism of this terminal differentiation process is unknown. We used morphological and immunohistochemical methods to investigate the maturation of the collecting duct system in neonatal rabbit kidney and under organotypic culture conditions. The new perifusion culturing method allowed us to follow the differentiation of the ampullary collecting duct epithelium under conditions as close as possible to the situation within the organ. With this technique we were able to induce a differentiation process similar to that in the in situ situation. This process led to the appearance of a mixed cell population consisting of principal and intercalated-like cells, respectively. A continuous perifusion of the medium made it possible to stabilize the microenvironment under culture conditions and thus to maintain the heterogeneous composed collecting duct epithelium in a differentiated status over long periods of time.