Autosomal dominant polycystic kidney disease (ADPKD) progresses to end-stage renal insufficiency before the age of 73 in approximately 48% of affected individuals. Why the disease, characterized by innumerable cysts arising in proximal and distal tubules, eliminates functioning non-cystic parenchyma in some patients and spares other is a mystery. The cysts initiate in early childhood in fewer than 1% of renal tubules as a consequence of the focal expression of mutated DNA. Tubule cells proliferate, causing segmental dilation, in association with the abnormal deposition of extracellular matrix proteins. Most of the cysts separate from the parent tubules and fill with fluid by cAMP-mediated chloride secretion. Risk factors associated with accelerated loss of renal function include: genotype (PKD Type 1 progresses more rapidly than PKD Type 2); gender (males progress more rapidly than females); race (black patients progress more rapidly than whites); hypertension; proteinuria. The relation between kidney size and progression to renal failure is debated. Progressive PKD is associated with the cellular expression of proto-oncogenes (fos, myc, ras, erb), growth factors (EGF, HGF, acid and basic FGF), chemokines (MCP-1. osteopontin), metalloproteinases, and apoptotic markers, and the interstitial accumulation of Types I and IV collagen, laminin, fibronectin, macrophages and fibroblasts, the magnitudes of which increase with age. Cyst activating factor (CAF), a neutral lipid identified in cyst fluid that stimulates fluid secretion and proliferation of renal epithelial cells and monocyte chemotaxis, has recently been identified as a potential progression factor. In those patients destined to develop renal failure there is loss of non-cystic parenchyma in association with mass replacement by fluid-filled cysts in a network of interstitial fibrosis. The decline in renal function is probably the consequence of processes leading to interstitial fibrosis, as in other nephropathies, rather than due to simple mechanical displacement of parenchyma by cysts.