Hepatocyte transplantation is being trialled as an alternative to whole organ transplant for patients with acute liver failure and liver specific metabolic diseases. Due to the scarcity of human hepatocytes, hepatocyte-like cells (HLC) generated from stem cells may become a viable alternative to hepatocyte transplantation. Human amniotic epithelial cells (hAEC) from the placenta have stem cell-like properties and can be differentiated into HLC. Naïve hAEC have low immunogenicity and exert immunomodulatory effects that may facilitate allogeneic transplantation. However, whether the immunogenicity and immunomodulatory properties alter with differentiation into HLC are unknown. We further characterized HLC generated from hAEC, examined changes in human leucocyte antigens (HLA) and co-stimulatory molecules and effects exerted by the HLC on human peripheral blood mononuclear cells (PBMC). HLC derived from hAEC expressed proteins found in hepatocytes, had CYP3A4 drug metabolizing enzyme activity and secreted urea. IFN-γ treatment increased HLA Class IA, Class II and co-stimulatory molecule CD40 expression in the HLC. IFN-γ treated HLC stimulated proliferation of PBMC in one-way mixed lymphocyte reactions and were more immunogenic than undifferentiated hAEC. However, the HLC showed immunomodulatory properties and inhibited mitogen induced PBMC proliferation in vitro. PBMC proliferation may have been inhibited by IL-6, TGF-β1, PGE2 and HLA-G secreted by the HLC. The retention of immunomodulatory properties may enable HLC grafts to survive for longer periods despite the immunogenicity of the HLC.