Sgk1 is a relatively unstable kinase that regulates epithelial Na(+) transport in the distal nephron of the kidney. We identified a 5' variant alternate transcript of human Sgk1 (Sgk1_v3) that is expressed in the connecting tubule and collecting duct, is regulated by aldosterone and insulin, and is predicted to encode an NH(2)-terminal variant Sgk1 isoform, Sgk1_i3. Sgk1_i3 contains a polybasic motif, KKR, in its NH(2) terminus that regulates ubiquitination and stability of the expressed protein in HEK293 cells. In Fisher rat thyroid, and mpkCCD(c14) cells, Sgk1_i3 had a significantly greater effect on Na(+) transport compared with Sgk1 and its stimulatory effect was dependent on the kinase domain. Sgk1_i3 increased the abundance of cleaved epithelial Na(+) channel (ENaC) subunits at the cell surface, which was inhibited by coexpression of Nedd4-2. Together, the data demonstrate that a renally expressed Sgk1 isoform, Sgk1_i3, shows improved stability, is regulated by insulin and aldosterone, and stimulates ENaC activity when heterologously expressed in collecting duct cells.