When chlorine is introduced into public drinking water for disinfection, it can react with organic compounds in surface waters to form toxic by-products such as 3-chloro-4-(dichloromethyl)-5-hydroxy-2[5H]-furanone (MX). We investigated the effect of exposure to MX on cytochrome P450 2E1 (CYP2E1)-like activity and total glutathione (GSH) in the liver of the small fish model, medaka (Oryzias latipes). The multi-site carcinogen methylazoxymethanol acetate (MAMAc) was the positive control compound. Both medaka liver microsome preparations and S-9 fractions catalyzed the hydroxylation of p-nitrophenol (PNP), suggesting CYP2E1-like activity in the medaka. Male medaka exposed for 96 h to the CYP2E1 inducers ethanol and acetone under fasted conditions showed significant increases in PNP-hydroxylation activity. Furthermore, total reduced hepatic GSH was reduced in fish fasted for 96 h, indicating that normal feeding is a factor in maintaining xenobiotic defenses. Exposure to MX and MAMAc induced significant increases in hepatic CYP2E1-like activity, however MX exposure did not alter hepatic GSH levels. These data strengthen the role of the medaka as a suitable species for examining cytochrome P450 and GSH detoxification processes and the role these systems play in chemical carcinogenesis.