In aldosterone target tissues, 11β-hydroxysteroid dehydrogenase type 2 (11βHSD2) is coexpressed with mineralocorticoid receptors (MR) and protects the receptor from activation by glucocorticoids. Null mutations in the encoding gene, HSD11B2, cause apparent mineralocorticoid excess, in which hypertension is thought to reflect volume expansion secondary to sodium retention. Hsd11b2^−/−mice are indeed hypertensive, but impaired natriuretic capacity is associated with significant volume contraction, suggestive of a urine concentrating defect. Water turnover and the urine concentrating response to a 24-h water deprivation challenge were therefore assessed in Hsd11b2^−/−mice and controls. Hsd11b2^−/−mice have a severe and progressive polyuric/polydipsic phenotype. In younger mice (∼2 mo of age), polyuria was associated with decreased abundance of aqp2 and aqp3 mRNA. The expression of other genes involved in water transport ( aqp4, slc14a2, and slc12a2) was not changed. The kidney was structurally normal, and the concentrating response to water deprivation was intact. In older Hsd11b2^−/−mice (>6 mo), polyuria was associated with a severe atrophy of the renal medulla and downregulation of aqp2, aqp3, aqp4, slc14a2, and slc12a2. The concentrating response to water deprivation was impaired, and the natriuretic effect of the loop diuretic bumetanide was lost. In older Hsd11b2^−/−mice, the V2 receptor agonist desmopressin did not restore full urine concentrating capacity. We find that Hsd11b2^−/−mice develop nephrogenic diabetes insipidus. Gross changes to renal structure are observed, but these were probably secondary to sustained polyuria, rather than of developmental origin.