It can be a tumor or it can metastasize into the kidneys from somewhere else in the body
I usually ask my kidney cancer patients that question b/c i always wondered also, usually they have found it as a result of pain in the flank area. OR. by accident, they went and had a CT scan for another problem and they saw something suspicious on the scan. It is rare, but mostly in younger adults unfortunately. The treatment is good and it usually doesnt spread to other organs (at least from the patients I have encountered)..dont quote me...they do a procedure called radio frequency ablation. Where they literally "fry" the bad cells away. It is a painful treatment and the patient is under anesthesia..hope that helps...
There are a lot of ways for it to happen. It could be genetic or could simply be a contact inhibition which means that during cell division the process was interrupted and cells become malignant.