We recently showed in a tetracycline-controlled transgenic mouse model that overexpression of transforming growth factor (TGF)-β1 in renal tubules induces widespread peritubular fibrosis and focal degeneration of nephrons. In the present study we have analyzed the mechanisms underlying these phenomena. The initial response to tubular cell-derived TGF-β1 consisted of a robust proliferation of peritubular cells and deposition of collagen. On sustained expression, nephrons degenerated in a focal pattern. This process started with tubular dedifferentiation and proceeded to total decomposition of tubular cells by autophagy. The final outcome was empty collapsed remnants of tubular basement membrane embedded into a dense collagenous fibrous tissue. The corresponding glomeruli survived as atubular remnants. Thus, TGF-β1 driven autophagy may represent a novel mechanism of tubular decomposition. The fibrosis seen in between intact tubules and in areas of tubular decomposition resulted from myofibroblasts that were derived from local fibroblasts. No evidence was found for a transition of tubular cells into myofibroblasts. Neither tracing of injured tubules in electron micrographs nor genetic tagging of tubular epithelial cells revealed cells transgressing the tubular basement membrane. In conclusion, overexpression of TGF-β1 in renal tubules in vivo induces interstitial proliferation, tubular autophagy, and fibrosis, but not epithelial-to-mesenchymal transition.