To examine whether hypoxia-inducible factor (HIF)-1α mediates the profibrotic effects of angiotensin II, we treated cultured renal medullary interstitial cells with angiotensin II and found that it increased HIF-1α levels. This was accompanied by a significant upregulation of collagen I/III, the tissue inhibitor of metalloproteinase-1, elevation of the proliferation marker proliferating cell nuclear antigen, and a transdifferentiation marker vimentin. All these effects of angiotensin II were completely blocked by siRNA for HIF-1α but not HIF-2α. Overexpression of a prolyl-hydroxylase domain-containing protein 2 (PHD2) transgene, the predominant renal HIF prolyl-hydroxylase, attenuated the effects of angiotensin II and its gene silencing enhanced the effects of angiotensin II. Removal of hydrogen peroxide eliminated angiotensin II-induced profibrotic effects. A 2-week infusion of rats with angiotensin II increased the expression of HIF-1α and α-smooth muscle actin, another marker of transdifferentiation, in renal medullary interstitial cells in vivo. Thus, our study suggests that HIF-1α mediates angiotensin II-induced profibrotic effects through activation of cell transdifferentiation. We propose that redox regulation of prolyl-PHD2 plays a critical role in angiotensin II-induced activation of HIF-1α in renal cells.