Congenital nephrogenic diabetes insipidus (NDI) is a disease characterized by failure of the kidney to concentrate urine in response to vasopressin. Human kindreds with nephrogenic diabetes insipidus have been found to harbor mutations in the vasopressin receptor 2 (Avpr2) gene or the vasopressin-sensitive water channel aquaporin-2 (Aqp2) gene. Development of a treatment is rendered difficult due to the lack of a viable animal model. Through forward genetic screening of ethylnitrosourea-mutagenized mice, we report the identification and characterization of a mouse model of NDI, with an F204V mutation in the Aqp2 gene. Unlike previously attempted murine models of NDI, our mice survive to adulthood and more exactly recapitulate the human disorder. Previous in vitro experiments using renal cell lines suggest recessive Aqp2 mutations result in improper trafficking of the mutant water pore. Using these animals, we have directly proven this hypothesis of improper AQP2 translocation as the molecular defect in nephrogenic diabetes insipidus in the intact organism. Additionally, using a renal cell line we show that the mutated protein, AQP2-F204V, is retained in the endoplasmic reticulum and that this abnormal localization can be rescued by wild-type protein. This novel mouse model allows for further mechanistic studies as well as testing of pharmacological and gene therapies for NDI.