Multiple foci of morphologically and functionally differentiated hepatocytes are induced in the pancreas of adult rats subjected to a copper depletion-repletion regimen. Differentiation of hepatocytes in pancreas is preceded by irreversible depletion of over 90% of pancreatic acinar cells. Progressive acinar cell loss during 4–6 weeks of copper deficiency results in the proliferation of oval cells, some of which may serve as the hepatocyte precursor or stem cells. Albumin mRNA is detected in oval cells at 5 and 6 weeks by in situ hybridization at which time no morphologically identifiable hepatocytes are evident in the pancreas. Immunocytochemical analysis demonstrated the presence of stem cell factor (SCF) in proliferating oval cells during 6 weeks of copper depletion, and Northern blot analysis revealed the expression of liverenriched transcription factors in the rat pancreas during this 4–6-week period of copper deficiency. CCAAT/enhancer binding protein α (C/EBPα) mRNA was detected first at 4 weeks of copper deficiency. By 5 and 6 weeks of copper deficiency, the expression of mRNAs of C/EBPα, β, and δ, and hepatocyte nuclear factor-3/β (HNF-3β) was markedly enhanced. This enhanced expression of liver-enriched transcription factors and the SCF during oval cell proliferation in the pancreas preceding the expression of albumin mRNA and subsequent differentiation of hepatocyte phenotype further supports the identity of these oval cells as hepatocyte precursors or stem cells.