Polycystin-2 (PC2) is a calcium permeable Transient Receptor Potential (TRP) channel activated and regulated by changes in cytoplasmic calcium. PC2 mutations are responsible for ~20% of Autosomal Dominant Polycystic Kidney Disease (ADPKD). This presentation will address two questions: first, how does calcium open the channel formed by PC2 and second, how do mutations in PC2 lead to cyst formation in ADPKD. For the first question, we noted that the C-terminal cytoplasmic tail of PC2 has been shown to contain calcium-binding EF-hand domains and the C-terminal tail of human (hPC2) contains two EF hand motifs, but only the second binds calcium. We proposed that these EF hand motifs serve as a calcium sensor responsible for the calcium-dependence of PC2 function. Using NMR and bioinformatics, we found that the overall EF hand fold is highly-conserved, but in evolutionarily earlier species, both EF hands bind calcium. To test if the EF hand motif is truly a calcium sensor controlling PC2 channel function, we altered the number of calcium binding sites in hPC2. Mutant PC2 channels unable to bind calcium via the EF-hand are inactive in single-channel planar bilayers. hPC2 that was modified to bind an additional calcium ion, as confirmed by NMR studies, demonstrated a shift in the calcium dependence in single channel recordings and enhanced calcium transients in imaging studies using fluorescent calcium-sensitive dyes (compared with wild-type hPC2). However, the channel was only functionally active if the second (native) calcium binding EF hand was intact. These results suggest that the number and location of calcium binding sites in the EF hand are important for normal PC2 channel activity and cellular function. For the second question we examined the effect of altered calcium signaling on cyst formation using 3D cultures of kidney epithelial cells. Stable cell lines were created with calcium signaling altered by decreased expression of PC2 or inositol 1,4,5 trisphosphate receptor (InsP3R) isoforms and monitored for the number and size of the resulting cysts. When these modified cells were maintained for 8 weeks in 3D cultures, all knockdown cell lines had more cysts and the cysts were larger than the control cells. Knockdown of InsP3R type 1 lead to the largest cysts. The primary cilium has been proposed to be essential for cyst growth, however the cysts with InsP3R type 1 knockdown continued to enlarge even though they had lost their cilia after 4 weeks. These studies suggest that calcium binding to PC2 is necessary for function and that altered calcium transients, due to changes in PC2 or other intracellular calcium channels, will lead to cyst formation and growth. We propose that the alterations in intracellular calcium signaling that occur when mutated PC2 is expressed are a critical component of the pathophysiological changes that lead to ADPKD.