The growing worldwide challenge of cirrhosis and hepatocellular carcinoma due to increasing prevalence of excessive alcohol consumption, viral hepatitis, obesity, and the metabolic syndrome has sparked interest in stem cell-like liver progenitor cells (LPCs) as potential candidates for cell therapy and tissue engineering, as an alternative approach to whole organ transplantation. However, LPCs always proliferate in chronic liver diseases with a predisposition to cancer; they have been suggested to play major roles in driving fibrosis, disease progression, and may even represent tumor-initiating cells. Hence, a greater understanding of the factors that govern their activation, communication with other hepatic cell types, and bipotential differentiation as opposed to their potential transformation is needed before their therapeutic potential can be harnessed.