Hepatic progenitor cells are immature epithelial cells that reside in the smallest ramifications of the biliary tree in human liver. These cells are capable of differentiating toward the biliary and the hepatocytic lineages and represent the human counterpart of the oval cells in murine liver. An increased number of progenitor cells (referred to as "activation") and differentiation of the same toward hepatocytes or bile duct epithelial cells, or both, is a component of virtually all human liver diseases. The extent of progenitor cell activation and the direction of differentiation are correlated with the severity of the disease and the type of mature epithelial cell (hepatocyte or bile duct epithelial cell), respectively, that is damaged. Analogous to findings in animal models of hepatocarcinogenesis, human hepatic progenitor cells most likely can give rise to hepatocellular carcinoma. The factors that govern human hepatic progenitor cell activation and differentiation are beginning to be identified.