The CXCR4 chemokine receptor is involved in hematopoietic stem cell homing, neuronal development, and angiogenesis. We show a significant new role for this receptor in epithelial patterning and renal morphogenesis. This receptor is expressed in the ureteric bud (UB) and the metanephric mesenchyme (MM). Stimulation of Cxcr4 in renal tubular cells leads to activation of multiple signaling pathways and tubulogenesis and cell migration. Knocking down of this receptor in tubular cells leads to cyst formation. Inactivation of this receptor in embryonic kidney explants results in impaired UB branching and mesenchymal tubulogenesis. The data presented here point to its importance in the process of mesenchymal-to-epithelial transitioning (MET), a crucial developmental process in the embryonic kidney. A number of genes important for normal tubulogenesis and MET are decreased upon CXCR4 inactivation.