Urea production from arginine was studied in vitro in the kidney of normal rats in tubule suspensions of the four different renal zones (cortex, outer and inner stripe of outer medulla, and inner medulla), and in individual microdissected nephron segments. Tissue was incubated with L-[guanido-14C]-arginine to measure cellular arginase activity. Addition of urease to the incubate freed 14CO2 from the 14C-urea formed by arginase and released from the cells. CO2 was trapped in KOH and counted. These experiments revealed that significant amounts of urea are produced in the outer stripe and in the inner medulla. This intrarenal urea generation takes place mainly in the proximal straight tubule and in the collecting duct, with increasing activity in these two structures from superficial to deep regions of the kidney. Urea is known to play a critical role in the urinary concentrating process. The fact that some urea can be produced in the mammalian kidney, and that the two structures showing this capacity are straight portions of the renal tubular system descending along the corticopapillary axis suggest that this urea production might play a role in the formation and/or maintenance of the medullary urea concentration gradient.