The direct renin inhibitor aliskiren has been shown to retain and persist in medullary collecting ducts even after treatment was discontinued, suggesting a new mechanism of action for this drug. The purpose of the present study was to investigate whether aliskiren regulates renal aquaporin expression in the collecting ducts and improves urinary concentrating defect induced by lithium in mice. The mice were either fed with normal chow or LiCl diet (40mM/kg dry food/day for 4 days and 20mM/kg dry food/day for last 3 days) for seven days. Some mice were intraperitoneally injected with aliskiren (50mg/kg BW/day in saline). Aliskiren significantly increased protein abundance of AQP2 in the kidney inner medulla in mice. In inner medulla collecting duct cell suspension, aliskiren markedly increased AQP2 and pS256-AQP2 protein abundance which was significantly inhibited either by adenylyl cyclase inhibitor MDL-12330A or by PKA inhibitor H89, indicating an involvement of the cAMP-PKA signaling pathway in aliskiren-induced increased AQP2 expression. Aliskiren treatment improved urinary concentrating defect in lithium-treated mice, and partially prevented the decrease of AQP2 and pS256-AQP2 protein abundance in inner medulla of the kidney. In conclusion, the direct renin inhibitor aliskiren upregulates AQP2 protein expression in inner medullary collecting duct principal cells and prevents lithium-induced nephrogenic diabetes insipidus (NDI) likely via cAMP-PKA pathways.