Angiotensin II (Ang II) induces a marked reduction in renal blood flow at doses well below those required to induce a pressor response, and as blood flow falls there is a decline in glomerular filtration rate and sodium excretion. This striking sensitivity of the renal blood supply led many workers to consider the possibility that angiotensin functions as a local renal hormone. As angiotensin converting enzyme (ACE) was found in particular abundance in the lung, it seemed reasonable to suspect that most of the conversion occurred there, and that the function of Ang II would be primarily systemic, rather than intrarenal. In this review, I will explore the evidence that has accumulated on these two possibilities, since they have important implications for our current understanding of normal kidney function and derangements of kidney function in disease.