Hepatocyte transplantation has therapeutic potential for multiple hepatic and extrahepatic disorders with genetic or acquired basis. To demonstrate whether cell populations of interest will be effective for clinical applications, it is first necessary to characterize their properties in animal systems. Demonstrating the potential of cells to engraft and proliferate is a critical part of this characterization. Similarly, for stem/progenitor cells, demonstrating the capacity to differentiate along appropriate lineages and generate mature cells that can engraft and proliferate is essential. In various animal models, preconditioning of recipients prior to cell transplantation has been necessary to improve engraftment of cells, to stimulate proliferation of engrafted cells, and to induce extensive repopulation of the host liver by transplanted cells. Although this is an area of active investigation, effective preconditioning protocols should alter the hepatic microenvironment, such that transplanted cells can obtain selective advantages for engrafting and proliferating in the liver. Use of such experimental systems in animals will help generate further strategies for liver repopulation and thereby advance clinical applications of liver cell therapy.