In nephrogenic diabetes insipidus, the kidney is unable to concentrate urine despite normal or elevated concentrations of the antidiuretic hormone arginine vasopressin (AVP). In congenital nephrogenic diabetes insipidus (NDI), the obvious clinical manifestations of the disease, that is polyuria and polydipsia, are present at birth and need to be immediately recognized to avoid severe episodes of dehydration. Most (>90%) congenital NDI patients have mutations in the AVPR2 gene, the Xq28 gene coding for the vasopressin V₂ (antidiuretic) receptor. In <10% of the families studied, congenital NDI has an autosomal recessive inheritance and mutations of the aquaporin-2 gene (AQP2), ie, the vasopressin-sensitive water channel, have been identified. When studied in vitro, most AVPR2 mutations lead to receptors that are trapped intracellularly and are unable to reach the plasma membrane. A minority of the mutant receptors reach the cell surface but are unable to bind AVP or to trigger an intracellular cyclic adenosine-monophosphate (cAMP) signal. Similarly AQP2 mutant proteins are trapped intracellularly and cannot be expressed at the luminal membrane. The acquired form of NDI is much more common than the congenital form, is almost always less severe, and is associated with downregulation of AQP2. The advances described here are examples of “bedside physiology” and provide diagnostic tools for physicians caring for these patients.