ErbB4 receptor tyrosine kinase contributes to the development of the heart, the central nervous system, and the lactating mammary gland, but whether it has a role in the development of the kidney epithelium is unknown. Here, we found that expression of Erbb4 isoforms JM-a CYT-1 and JM-a CYT-2 was first detectable around embryonic day 13 in the mouse, mainly in the collecting ducts and both the proximal and distal tubules. In vitro, overexpression of a relevant ErbB4 isoform promoted proliferation and disturbed polarization of kidney epithelial cells when cultured as three-dimensional structures. We examined ErbB4 function in developing kidney tubules in vivo with Pax8-Cre-mediated conditional overexpression of Rosa26 locus-targeted ERBB4 and with conditional Erbb4 knock-out mice. The Pax8-Cre-driven ERBB4 overexpression enhanced proliferation in the collecting ducts, reduced the size of epithelial duct lumens, and promoted formation of cortical tubular cysts. These defects were associated with changes in the subcellular distribution of markers of epithelial cell polarity. Similarly, the Pax8-Cre-mediated Erbb4 knock-out mice manifested dysfunctional kidneys with larger duct lumens and epithelial cell mispolarization. Taken together, these data suggest that ErbB4 signaling modulates proliferation and polarization, cellular functions critical for the development of epithelial ducts in the kidney.