Natriuretic peptides (NPs), mainly produced in heart [atrial (ANP) and B-type (BNP)], brain (CNP), and kidney (urodilatin), decrease blood pressure and increase salt excretion. These functions are mediated by natriuretic peptide receptors A and B (NPRA and NPRB) having cytoplasmic guanylyl cyclase domains that are stimulated when the receptors bind ligand. A more abundantly expressed receptor (NPRC or C-type) has a short cytoplasmic domain without guanylyl cyclase activity. NPRC is thought to act as a clearance receptor, although it may have additional functions. To test how NPRC affects the cardiovascular and renal systems, we inactivated its gene (Npr3) in mice by homologous recombination. The half life of [125I]ANP in the circulation of homozygotes lacking NPRC is two-thirds longer than in the wild type, although plasma levels of ANP and BNP in heterozygotes and homozygotes are close to the wild type. Heterozygotes and homozygotes have a progressively reduced ability to concentrate urine, exhibit mild diuresis, and tend to be blood volume depleted. Blood pressure in the homozygotes is 8 mmHg (1 mmHg = 133 Pa) below normal. These results are consistent with the sole cardiovascular/renal function of NPRC being to clear natriuretic peptides, thereby modulating local effects of the natriuretic peptide system. Unexpectedly, Npr3 -/- homozygotes have skeletal deformities associated with a considerable increase in bone turnover. The phenotype is consistent with the bone function of NPRC being to clear locally synthesized CNP and modulate its effects. We conclude that NPRC modulates the availability of the natriuretic peptides at their target organs, thereby allowing the activity of the natriuretic peptide system to be tailored to specific local needs.