Signaling by GDNF through the Ret receptor is required for normal growth of the ureteric bud during kidney development. However, the precise role of GDNF/Ret signaling in renal branching morphogenesis and the specific responses of ureteric bud cells to GDNF remain unclear. Recent studies have provided new insight into these issues. The localized expression of GDNF by the metanephric mesenchyme, together with several types of negative regulation, is important to elicit and correctly position the initial budding event from the Wolffian duct. GDNF also promotes the continued branching of the ureteric bud. However, it does not provide the positional information required to specify the pattern of ureteric bud growth and branching, as its site of synthesis can be drastically altered with minimal effects on kidney development. Cells that lack Ret are unable to contribute to the tip of the ureteric bud, apparently because GDNF-driven proliferation is required for the formation and growth of this specialized epithelial domain. BioEssays 28: 117–127, 2006. © 2006 Wiley periodicals, Inc.