Antidiuretic hormone liberated the vertebrates from their aqueous environment, and permitted them to establish themselves on dry land. The combination of sensitive volume and osmoreceptors, a pituitary secretory apparatus which can vary its output from virtually zero to high levels in a short space of time, and receptor cells functioning in the countercurrent system of the renal medulla, has resulted in a water conservation system of great efficiency. The hormone rapidly alters the luminal membrane of receptor cells in the collecting tubule and collecting duct, increasing the permeability of these structures to water.1 The permeability of the collecting duct to urea and sodium is also increased.This review will be centered on the sequence of events that follows the attachment of vasopressin to its receptors in the distal nephron. This has become an area of intense activity since the discovery by Sutherland and his colleagues of the central role of cyclic AMP in the action of hormones [2]. The review will cover in brief much of the ground covered by the extensive review of Handler and OrlofT [3], emphasizing recent additions to the literature. It is regrettable that the important advances in our understanding of the synthesis and release of antidiuretic hormone cannot be included; the reader is referred to recent symposia and reviews in this area [4–6], as well as in the comparative physiology of water regulation [7] and the countercurrent system [8].