Amiloride inhibits the epithelial sodium channels on principal cells in the late distal convoluted tubule and collecting tubule, which are responsible for 1-2% of total sodium reabsorption. As sodium reabsorption is inhibited, this increases the osmolarity in the nephron lumen and decreases the osmolarity of the interstitium. Since sodium concentration is the main driving force for water reabsorption, amiloride can achieve a modest amount of diuresis by decreasing the osmotic gradient necessary for water reabsorption from lumen to interstitium.
Amiloride also has a potassium-sparing effect. Normally, the process of potassium excretion is driven by the electrochemical gradient produced by sodium reabsorption. As sodium is reabsorbed, it leaves a negative potential in the lumen, while producing a positive potential in the principal cell. This potential promotes potassium excretion through apical potassium channels. By inhibiting sodium reabsorption, amiloride also inhibits potassium excretion.