Key points Mammalian cells are frequently exposed to stressors causing volume changes. The transient receptor potential vanilloid 4 (TRPV4) channel translates osmotic stress into ion flux. The molecular mechanism coupling osmolarity to TRPV4 activation remains elusive. TRPV4 responds to isosmolar cell swelling and osmolarity translated via different aquaporins. TRPV4 functions as a volume‐sensing ion channel irrespective of the origin of the cell swelling. Abstract Transient receptor potential channel 4 of the vanilloid subfamily (TRPV4) is activated by a diverse range of molecular cues, such as heat, lipid metabolites and synthetic agonists, in addition to hyposmotic challenges. As a non‐selective cation channel permeable to Ca2+, it transduces physical stress in the form of osmotic cell swelling into intracellular Ca2+‐dependent signalling events. Its contribution to cell volume regulation might include interactions with aquaporin (AQP) water channel isoforms, although the proposed requirement for a TRPV4–AQP4 macromolecular complex remains to be resolved. To characterize the elusive mechanics of TRPV4 volume‐sensing, we expressed the channel in Xenopus laevis oocytes together with AQP4. Co‐expression with AQP4 facilitated the cell swelling induced by osmotic challenges and thereby activated TRPV4‐mediated transmembrane currents. Similar TRPV4 activation was induced by co‐expression of a cognate channel, AQP1. The level of osmotically‐induced TRPV4 activation, although proportional to the degree of cell swelling, was dependent on the rate of volume changes. Importantly, isosmotic cell swelling obtained by parallel activation of the co‐expressed water‐translocating Na+/K+/2Cl− cotransporter promoted TRPV4 activation despite the absence of the substantial osmotic gradients frequently employed for activation. Upon simultaneous application of an osmotic gradient and the selective TRPV4 agonist GSK1016790A, enhanced TRPV4 activation was observed only with subsaturating stimuli, indicating that the agonist promotes channel opening similar to that of volume‐dependent activation. We propose that, contrary to the established paradigm, TRPV4 is activated by increased cell volume irrespective of the molecular mechanism underlying cell swelling. Thus, the channel functions as a volume‐sensor, rather than as an osmo‐sensor.