Thiazolidinediones (TZDs) are widely used to treat type 2 diabetes mellitus; however, their use is complicated by systemic fluid retention. Along the nephron, the pharmacological target of TZDs, peroxisome proliferator-activated receptor-gamma (PPARgamma, encoded by Pparg), is most abundant in the collecting duct. Here we show that mice treated with TZDs experience early weight gain from increased total body water. Weight gain was blocked by the collecting duct-specific diuretic amiloride and was also prevented by deletion of Pparg from the collecting duct, using Pparg (flox/flox) mice. Deletion of collecting duct Pparg decreased renal Na(+) avidity and increased plasma aldosterone. Treating cultured collecting ducts with TZDs increased amiloride-sensitive Na(+) absorption and Scnn1g mRNA (encoding the epithelial Na(+) channel ENaCgamma) expression through a PPARgamma-dependent pathway. These studies identify Scnn1g as a PPARgamma target gene in the collecting duct. Activation of this pathway mediates fluid retention associated with TZDs, and suggests amiloride might provide a specific therapy.