Urothelial barrier function is maintained by apical membrane plaques and intercellular tight junctions (TJ). Little is known about the composition and regulation of TJ expression in human urothelium. In this study, we have characterised the expression of TJ components in situ and their regulation in an in vitro model of differentiating normal human urothelial (NHU) cells. In normal ureteric urothelium in situ, there was a differentiation‐associated profile of claudins 3, 4, 5, 7, ZO1 and occludin proteins. Proliferating NHU cells in vitro expressed predominantly claudin 1 protein and transcripts for claudins 1–5 and 7. Following induction of differentiation by pharmacological activation of PPARγ and blockade of EGFR, there was de novo expression of claudin 3 mRNA and protein and downregulation of claudin 2 transcription. There was also a massive increase in expression of claudin 4 and 5 proteins which was due to inhibition of proteasomal degradation of claudin 4 and consequential stabilisation of the claudin 5 heterodimerisation partner. NHU cell differentiation was accompanied by relocalisation of TJ proteins to intercellular junctions. The differentiation‐associated development of TJ formation in vitro reflected the stage‐related TJ expression seen in situ. This was distinct from changes in TJ composition of NHU cells mediated by increasing the calcium concentration of the medium. Our results imply a role for PPARγ and EGFR signalling pathways in regulating TJ formation in NHU cells and support the hypothesis that TJ development is an integral part of the urothelial differentiation programme. J. Cell. Physiol. 208: 407–417, 2006. © 2006 Wiley‐Liss, Inc.