Interruption of ANG II signalling in the postnatal period leads to pathological changes in the kidneys characterized by impaired nephron formation, shortening and wall thickening of the preglomerular arteries and papillary atrophy. The mechanism for this effect is not clear. We hypothesized that ANG II is crucial for maintaining capillary angiogenesis during postnatal development. Rat pups were treated with subcutaneous injections of AT1 receptor antagonist (candesartan 1 mg/kg×day) or vehicle from postnatal day 1 (P1) to P13. On P14, pups were sacrificed and kidneys were analyzed for vascular growth factors and postglomerular microvessel quantity. Quantitative PCR analysis of cortex and medulla showed a significantly decreased expression of VEGF, angiopoietin-1 and -2 and Tie-2. Unbiased stereological measurements showed a significant reduction in total capillary length in cortex (28819.6 m versus 21117.8 m) and medulla (23515.8 m versus 1335.9 m). Vasa recta bundle assembly was impaired by candesartan in outer medulla and microdissected bundles exhibited fewer mitoses as judged by PCNA abundance. Renal blood flow (RBF) and GFR was estimated in candesartan- treated pups (P1-P13) at P30 by Magnetic Resonance Imaging. RBF was reduced significantly (~20 %) in the candesartan-treated group. GFR was unchanged. We conclude that ANG II signalling is necessary for postnatal development of postglomerular capillaries and vasa recta bundles and inhibition of AT1 receptors in the postnatal period leads to decreased RBF in early adulthood.