Technological advances in the separation and culture of mammalian hepatocytes have facilitated the use of these cells as the foundation for either hepatocyte transplantation or hepatocyte-seeded hollow fiber liver assist devices (LAD). To fully appreciate the practical applications of these tissue engineering solutions, it is necessary to understand the types of human liver failure as well as the corresponding animal models. The most immediate application of this type of technology is the treatment of hepatic encephalopathy (HE), an acute and highly fatal complication of fulminant hepatic failure. Although the pathogenesis of HE is unknown, failure of the detoxification function of the liver is accepted as playing an important role in this disorder. Consequently, the assaying and preservation of P450 activity in the grafted cells or in the LAD must be among the main targets of this research. This review explores the problems in hepatocyte transplantation and culture that deserve special consideration and emphasizes the conditions contributing to the in vitro maintenance of phenotypic expression of these cells.