Hepatocyte transplantation and artificial organ hepatic support require a number of functionally mature hepatocytes. However, their growth activity and functional behaviors are much smaller in culture after isolation from the liver. We examined whether continuously differentiating hepatocytes from multipotent hepatic stem cells that were isolated by using flow cytometry and propagated clonally in culture could be a source of clinical application. They actually gave rise to cells that were functionally equal to mature hepatocytes found in the adult liver, which secreted albumin into culture medium and metabolized harmful ammonium into urea. These data suggest that stem cell-derived hepatocytes are a useful cell source for developing therapeutic strategies, such as cell transplantation, gene therapy, and artificial liver organ to treat various liver disorders.