The mammalian collecting duct comprises principal and intercalated cells, which maintain sodium/water and acid/base balance, respectively, but the epigenetic contributors to the differentiation of these cell types remain unknown. Here, we investigated whether the histone H3 K79 methyltransferase Dot1l, which is highly expressed in principal cells, participates in this process. Taking advantage of the distribution of aquaporin 2 (Aqp2), which localizes to principal cells of the collecting duct, we developed mice lacking Dot1l in Aqp2-expressing cells (Dot1l(AC)) and found that these mice had approximately 20% fewer principal cells and 13%-16% more intercalated cells than control mice. This deletion of Dot1l in principal cells abolished histone H3 K79 methylation in these cells, but unexpectedly, most intercalated cells also had undetectable di-methyl K79, suggesting that Aqp2(+) cells give rise to intercalated cells. These Aqp2(+) cell-derived intercalated cells were present in both developing and mature kidneys. Furthermore, compared with control mice, Dot1l(AC) mice had 40% higher urine volume and 18% lower urine osmolarity with relatively normal electrolyte and acid-base homeostasis. In conclusion, these data suggest that Dot1l deletion facilitates the differentiation of some α- and β-intercalated cells from Aqp2-expressing progenitor cells or mature principal cells.