The molecular regulation of the complex inductive events associated with formation of the vertebrate excretory system has been progressively elucidated as a result of both genetic and tissue culture approaches. Kidney organogenesis is initiated and maintained by a series of reciprocal inductive interactions between different tissues derived from the intermediolateral mesoderm to form the nephrons and collecting system of the metanephric kidney. Recent progress in this area has resulted in the identification of regulatory systems controlling branching morphogenesis of the ureteric bud, formation of the early renal vesicle and the glomerulus. These events are controlled by genes that regulate pattern formation, cellular proliferation, and differentiation in other tissues. Although it is not yet possible to completely identify a complete genetic pathway required for any one of the many steps in nephrogenesis, it is now evident that pathways previously identified in studies of mesenchymal-epithelial inductive mechanisms in limb bud, neural tissues, lung, and gut have direct relevance to the study of these processes in kidney development. For instance, a primary system for pattern formation involving retinoic acid, homeobox genes, sonic hedgehog, fibroblast growth factor (FGF), and an FGF receptor all appear to function in limb, lung, and kidney organogenesis. A major challenge is determining how this common cast of signalling molecules plays a specific role in kidney development essential to nephrogenesis, which results in the unique structural organization of the adult kidney. From this more-sophisticated understanding will come important insights relevant to understanding the molecular basis of developmental malformations of the kidney necessary for the prevention and treatment of these disorders.