Abstract Autosomal-dominant polycystic kidney disease (ADPKD) is the most common inherited kidney disease, leading to kidney failure in most patients. In approximately 85% of cases, the disease is caused by mutations in PKD1. How dysregulation of PKD1 leads to cyst formation on a molecular level is unknown. Induced pluripotent stem cells (iPSCs) are a powerful tool for in vitro modeling of genetic disorders. Here, we established ADPKD patient-specific iPSCs to study the function of PKD1 in kidney development and cyst formation in vitro. Somatic mutations are proposed to be the initiating event of cyst formation, and therefore, iPSCs were derived from cystic renal epithelial cells rather than fibroblasts. Mutation analysis of the ADPKD iPSCs revealed germline mutations in PKD1 but no additional somatic mutations in PKD1/PKD2. Although several somatic mutations in other genes implicated in ADPKD were identified in cystic renal epithelial cells, only few of these mutations were present in iPSCs, indicating a heterogeneous mutational landscape, and possibly in vitro cell selection before and during the reprogramming process. Whole-genome DNA methylation analysis indicated that iPSCs derived from renal epithelial cells maintain a kidney-specific DNA methylation memory. In addition, comparison of PKD1+/− and control iPSCs revealed differences in DNA methylation associated with the disease history. In conclusion, we generated and characterized iPSCs derived from cystic and healthy control renal epithelial cells, which can be used for in vitro modeling of kidney development in general and cystogenesis in particular. Significance statement Autosomal dominant polycystic kidney disease (ADPKD) is the most common inherited kidney disease, leading to kidney failure in most patients. In approximately 85% of cases, the disease is caused by mutations in PKD1. How dysregulation of PKD1 leads to cyst formation on a molecular level is unknown. The present study has generated induced pluripotent stem cells (iPSCs) of ADPKD patients to study the function of PKD1 in kidney development and cyst formation in vitro. The iPSCs revealed germline and autosomal mutations implicated in ADPKD and displayed an epigenetic memory of kidney epithelial cells, providing powerful models to study ADPKD in vitro.