Notch genes encode transmembrane receptors that mediate intercellular interaction by binding to the ligands on the adjacent cells. Due to early embryonic lethality in mice deficient for some Notch pathway genes, the role of Notch signaling for kidney development has not yet been defined. Using an antibody specific to the N-terminal end of gamma-secretase-cleaved Notch 1, we found evidence for Notch 1 activation in the comma-shaped and S-shaped bodies. We therefore cultured embryonic (E) day E12.5 mouse metanephroi in the presence of a gamma-secretase inhibitor, N-S-phenyl-glycine-t-butyl ester (DAPT), to block Notch signaling. Fewer renal epithelial structures were observed, with a severe deficiency in proximal tubules and glomerular podocytes. Distal tubules were present but at a reduced number, and this was accompanied by an increase in intervening, nonepithelial cells. By culturing day E14.5 metanephroi, we observed the formation of podocyte clusters after 3 days of DAPT treatment. These observations suggest that gamma-secretase activity, probably through activation of Notch, is not essential for podocyte formation beyond the stage of S-shaped body but is required for the proximal tubule and podocyte fates when S-shaped bodies are forming.