Mutations of genes in the renin-angiotensin system are associated with congenital abnormalities of the kidney and urinary tract. The major signaling pathway for branching morphogenesis during kidney development is the c-Ret receptor tyrosine kinase whose ligand is GDNF and whose downstream target is Wnt11. We determined whether angiotensin II, an inducer of ureteric bud branching in vitro, influences the GDNF/c-Ret/Wnt11 pathway. Mouse metanephroi were grown in the presence or absence of angiotensin II or an angiotensin type 1 receptor (AT1R) antagonist and gene expression was measured by whole mount in situ hybridization. Angiotensin II induced the expression of c-Ret and Wnt11 in ureteric bud tip cells. GDNF, a Wnt11-regulated gene expressed in the mesenchyme, was also upregulated by angiotensin II but this downregulated Spry1, an endogenous inhibitor of Ret tyrosine kinase activity in an AT1R-dependent manner. Angiotensin II also decreased Spry1 mRNA levels in cultured ureteric bud cells. Exogenous angiotensin II preferentially stimulated ureteric bud tip cell proliferation in vivo while AT1R blockade increased cell apoptosis. Our findings suggest AT1R-mediated inhibition of the Spry1 gene increases c-Ret tyrosine kinase activity leading to upregulation of its downstream target Wnt11. Enhanced Wnt11 expression induces GDNF in adjacent mesenchyme causing focal bursts of ureteric bud tip cell proliferation, decreased tip cell apoptosis and branching.