Autosomal dominant polycystic kidney disease (ADPKD) is common and is a major cause of renal failure. Although the genetics of ADPKD are well known and have led to the discovery of polycystins, a new protein family, the pathogenesis of the disease remains largely unknown. Recent studies have indicated that the β-catenin signaling pathway is one of the targets of the transduction pathway controlled by the polycystins. We have generated transgenic mice that overproduce an oncogenic form of β-catenin in the epithelial cells of the kidney. These mice developed severe polycystic lesions soon after birth that affected the glomeruli, proximal, distal tubules and collecting ducts. The phenotype of these mice mimicked the human ADPKD phenotype. Cyst formation was associated with an increase in cell proliferation and apoptosis. The cell proliferation and apoptotic indexes was increased 4–5-fold and 3–4-fold, respectively, in cystic tubules of the transgenic mice compared to that of littermate controls. Our findings provide experimental genetic evidence that activation of the Wnt/β-catenin signaling pathway causes polycystic kidney disease and support the view that dysregulation of the Wnt/β-catenin signaling is involved in its pathogenesis.