The epithelial Na+ channel (ENaC) plays a critical role in Na+ absorption in the kidney and other epithelia. Mutations in the C terminus of the beta or gammaENaC subunits increase renal Na+ absorption, causing Liddle's syndrome, an inherited form of hypertension. These mutations delete or disrupt a PY motif that was recently shown to interact with Nedd4, a ubiquitin-protein ligase expressed in epithelia. We found that Nedd4 inhibited ENaC when they were coexpressed in Xenopus oocytes. Liddle's syndrome-associated mutations that prevent the interaction between Nedd4 and ENaC abolished inhibition, suggesting that a direct interaction is required for inhibition by Nedd4. Inhibition also required activity of a ubiquitin ligase domain within the C terminus of Nedd4. Nedd4 had no detectable effect on the single channel properties of ENaC. Rather, Nedd4 decreased cell surface expression of both ENaC and a chimeric protein containing the C terminus of the beta subunit. Decreased surface expression resulted from an increase in the rate of degradation of the channel complex. Thus, interaction of Nedd4 with the C terminus of ENaC inhibits Na+ absorption, and loss of this interaction may play a role in the pathogenesis of Liddle's syndrome and other forms of hypertension.