We studied 32 patients with chronic renal failure for cystic transformation of the diseased kidneys. All patients had been maintained on hemodialysis and none had primary cystic kidney disease. On necropsy, 15 patients were found to have developed cysts in their kidneys. Cystic transformation was not necessarily associated with an increase in size or weight of the kidneys. The main determinant of the cystic changes were duration of kidney disease and length of time on dialysis. The acquired cysts seemed to lack significant exocrine and endocrine activities.