Polycystin-1 (PC1) mutations result in proliferative renal cyst growth and progression to renal failure in autosomal dominant polycystic kidney disease (ADPKD). The transcription factor STAT3 (signal transducer and activator of transcription 3) was shown to be activated in cyst-lining cells in ADPKD and PKD mouse models and may drive renal cyst growth, but the mechanisms leading to persistent STAT3 activation are unknown. A proteolytic fragment of PC1 corresponding to the cytoplasmic tail, PC1-p30, is overexpressed in ADPKD. Here, we show that PC1-p30 interacts with the nonreceptor tyrosine kinase Src, resulting in Src-dependent activation of STAT3 by tyrosine phosphorylation. The PC1-p30-mediated activation of Src/STAT3 was independent of JAK family kinases and insensitive to the STAT3 inhibitor suppressor of cytokine signaling 3. Signaling by the EGF receptor (EGFR) or cAMP amplified the activation of Src/STAT3 by PC1-p30. Expression of PC1-p30 changed the cellular response to cAMP signaling. In the absence of PC1-p30, cAMP dampened EGFR- or IL-6-dependent activation of STAT3; in the presence of PC1-p30, cAMP amplified Src-dependent activation of STAT3. In the polycystic kidney (PCK) rat model, activation of STAT3 in renal cystic cells depended on vasopressin receptor 2 (V2R) signaling, which increased cAMP levels. Genetic inhibition of vasopressin expression or treatment with a pharmacologic V2R inhibitor strongly suppressed STAT3 activation and reduced renal cyst growth. These results suggest that PC1, via its cleaved cytoplasmic tail, integrates signaling inputs from EGFR and cAMP, resulting in Src-dependent activation of STAT3 and a proliferative response.