(Directly taken from the application) Polycystic kidney disease (PKD) is characterized by proliferating epithelial cells, alterations in basement membrane composition, and aberrant localization of cell surface proteins. These cellular properties are consistent with a reversion of the renal epithelial cell to a more embryonic phenotype. Thus, genes regulating the differentiation and proliferation of the normal renal epithelium may be aberrantly affected in PKD and may directly contribute to the initiation and progression of the disease. This proposal will address the function of the transcription factor, Pax-2, in the development of normal and cystic renal epithelium. Pax-2 is required and sufficient for the conversion of the kidney mesenchyme to an epithelial phenotype by acting as a differentiation and proliferation stimulus. Pax-2 expression in the developing kidney is repressed as the normal epithelium matures, but is detected at higher levels in the cystic epithelium of experimental animals. The proposed experiments will determine the developmental expression pattern of Pax-2 in the cpk mouse, a well-characterized model for PKD. Furthermore, the cpk mutation will be crossed into the Krd mutant mouse that has one Pax-2 allele deleted. This genetic cross will test for modification of cpk by Pax-2 using gene dosage. If continued expression of Pax-2 in cpk mice is a proliferation stimulus, reducing the Pax-2 gene dosage may result in a slower progressing form of PKD. Additional experiments will address the regulation of the Pax-2 gene by identifying promoter elements required for tissue specific transcription. Finally, preliminary data indicates several cell adhesion molecules of the cadherin gene family may be regulated directly by Pax-2. The cadherin regulatory sequences will be cloned and tested for their ability to bind Pax-2 and mediate trans- activation. These experiments will elucidate basic molecular mechanisms of renal epithelial morphogenesis and may lead to a more complete understanding of the aberrant developmental events underlying PKD. Ultimately, understanding the regulation and function of transcription factors in renal diseases may lead to novel therapeutic interventions based on modulating gene expression.