Vascular endothelial growth factor (VEGF-A) plays multiple roles in kidney development: stimulates cell proliferation, survival, tubulogenesis, and branching morphogenesis. However, the mechanism that mediates VEGF-A induced ureteric bud branching is unclear. Glial-derived neurotrophic factor (GDNF) signaling through tyrosine kinase c-RET is the major regulator of ureteric bud branching. Here we examined whether VEGF-A regulates RET signaling. We determined that ureteric bud-derived cells express the main VEGF-A signaling receptor, VEGFR2 and RET, by RT-PCR, immunoblotting, and immunocytochemistry. We show that the VEGF-A isoform VEGF(165) induces RET-tyr(1062) phosphorylation in addition to VEGFR2 autophosphorylation, that VEGF(165) and GDNF have additive effects on RET-tyr(1062) phosphorylation, and that VEGFR2 and RET co-immunoprecipitate. Functionally, VEGF(165) induces ureteric bud cell proliferation and branching morphogenesis. Similarly, in embryonic kidney explants VEGF(165) induces RET-tyr(1062) phosphorylation and upregulates GDNF. These findings provide evidence for a novel cooperative interaction between VEGFR2 and RET that mediates VEGF-A functions in ureteric bud cells.