The V2 vasopressin receptor (V2R) plays a key role in the maintenance of a normal body water balance. To generate an in vivo model that allows the physiological and molecular analysis of the role of V2Rs in kidney function, we have created mouse lines that lack functional V2Rs by using targeted mutagenesis in mouse embryonic stem cells. Specifically, we introduced a nonsense mutation known to cause X-linked nephrogenic diabetes insipidus (XNDI) in humans (Glu242stop) into the mouse genome. V2R-deficient hemizygous male pups showed a decrease in basal urine osmolalities and were unable to concentrate their urine. These pups also exhibited an enlargement of renal pelvic space, failed to thrive, and died within the first week after birth due to hypernatremic dehydration. Interestingly, female mice heterozygous for the V2R mutation showed normal growth but displayed an XNDI-like phenotype, characterized by reduced urine concentrating ability of the kidney, polyuria, and polydipsia. Western blot analysis and immunoelectron microscopic studies showed that the loss of functional V2Rs had no significant effect on the basal expression levels of aquaporin-2 and the bumetanide-sensitive Na-K-2Cl cotransporter (BSC-1). The V2R mutant mice described here should serve as highly useful tools for the development of novel therapeutic strategies for the treatment of XNDI.