The damaging effects of hypertonic stress on cellular proteins are poorly defined and almost nothing is known about the pathways that detect and repair hypertonicity-induced protein damage. To begin addressing these problems, we screened ~19,000 C. elegans genes by RNA interference (RNAi) feeding and identified 49 that are essential for survival during acute hypertonic stress. Almost half of these genes (22/49) encode proteins that function to detect, transport and degrade damaged proteins, including components of the ubiquitin-proteasome system, endosomal sorting complexes and lysosomes. High molecular weight ubiquitin conjugates increase during hypertonic stress suggesting a global change in the ubiquitinylation state of endogenous proteins. Using a polyglutamine-containing fluorescent reporter, we demonstrate that cell shrinkage induces rapid protein aggregation in vivo and that many of the genes that are essential for survival during hypertonic stress function to prevent accumulation of aggregated proteins. High levels of urea, a strong protein denaturant, do not cause aggregation suggesting that factors such as macromolecular crowding also contribute to protein aggregate formation during cell shrinkage. Acclimation of C. elegans to mild hypertonicity dramatically increases the osmotic threshold for protein aggregation demonstrating that protein aggregation-inhibiting pathways are activated by osmotic stress. Our studies demonstrate that hypertonic stress induces protein damage in vivo and that detection and degradation of damaged proteins are essential mechanisms for survival under hypertonic conditions.