The distal nephron plays a critical role in the renal control of homeostasis. Until very recently most studies focused on the control of Na⁺, K⁺, and water balance by principal cells of the collecting duct and the regulation of solute and water by hormones from the renin-angiotensin-aldosterone system and by antidiuretic hormone. However, recent studies have revealed the unexpected importance of renal intercalated cells, a subtype of cells present in the connecting tubule and collecting ducts. Such cells were thought initially to be involved exclusively in acid-base regulation. However, it is clear now that intercalated cells absorb NaCl and K⁺ and hence may participate in the regulation of blood pressure and potassium balance. The second paradigm-challenging concept we highlight is the emerging importance of local paracrine factors that play a critical role in the renal control of water and electrolyte balance.