TRPM7 (transient-receptor-potential melastatin 7) is an ion channel with α-kinase function. TRPM7 is divalent-selective and regulated by a range of receptor-stimulated second messenger pathways, intracellular Mg-nucleotides, divalent and polyvalent cations and pH. TRPM7 is ubiquitously found in mammalian cells, including kidney, the responsible organ for osmolyte regulation, posing the question whether the channel is osmosensitive. Recent reports investigated the sensitivity of native TRPM7-like currents to cell swelling with contradictory results. Here, we assess the sensitivity of TRPM7 to both hypo- and hyperosmotic conditions and explored the involvement of the channel's kinase domain. We find that hypotonicity facilitates TRPM7 at elevated intracellular magnesium and Mg·ATP (3–4 mm), but has no effect in the absence of these solutes. Hypertonic conditions, in contrast, inhibit TRPM7 with an IC50 of 430 mosmol l−1. This inhibitory effect is maintained in the complete absence of intra- and extracellular divalent ions, although shifted to higher osmolarities (IC50= 510 mosmol l−1). TRPM7 senses osmotic gradients rather than ionic strength and this is independent of cAMP or not affected by cytochalasin D treatment. Furthermore, the kinase-domain deletion mutant of TRPM7 shows a similar behaviour to osmolarity as the wild-type protein, both in the presence and absence of divalent ions. This indicates that at least part of the osmosensitivity resides in the channel domain. Physiologically, TRPM7 channels do not seem to play an active role in regulatory volume changes, but rather those volume changes modulate TRPM7 activity through changes in the cytosolic concentrations of free Mg, Mg-nucleotides and a further unidentified factor. We conclude that TRPM7 senses osmotically induced changes primarily through molecular crowding of solutes that affect channel activity.