The purpose of this report is to summarize data collected over the past several years in the field of hepatocyte transplantation. Herein, a novel method of intraperitoneal transplantation of hepatocytes attached to collagen-coated microcarriers (or a totally biodegradable collagen sponge) is described, resulting in correction of specific genetic liver defects in rats and improved survival in rats undergoing 90% partial hepatectomy. Transplanted cells/matrix form well-vascularized aggregates in the peritoneal cavity; transplanted hepatocytes can be identified by light microscopy using immunohistochemical methods. Prolongation of transplanted hepatocyte survival and function was demonstrated by pretreatment of cells with ultraviolet irradiation. The ability of transplanted cells to proliferate was examined using both biochemical and morphologic criteria. Finally, a method of harvesting, cryopreserving, andin vivo functional testing of human hepatocytes is described.