Hepatocytes and fat-storing cells have been implicated in the production of collagen, under both normal and pathological conditions. In this study, short-term primary cultures of rat hepatocytes, maintained in a serum-free, hormonally defined medium without dexamethasone and cultured on a fibronectin-collagen type IV substratum, were used. Primary and passage 1 and 2 cultures of fat-storing cells maintained on tissue culture plastic were also studied. Hepatocytes produced significant amounts of collagen type III, but formation of collagen type I was not detectable. Laminin and collagen type IV production were very low. Hepatocytes maintained their ability to metabolize ethanol (at levels comparable to those observed at 2 hr) for at least 48 hr after plating and this metabolism was inhibited 86% to 95% by 4-methylpyrazole (1 mmol/L). Neither ethanol (50 mmol/L) nor acetaldehyde (175 μmol/L, initial concentration) had any effect on the production of collagen type III or laminin. Fat-storing cells (95% to 100% desmin-positive) produced significant amounts of both type I and type III collagen. Production of collagen type IV and laminin was very low. Metabolism of ethanol by these cultures was not detected. Addition of ethanol had no effect on collagen or laminin production in fat-storing cells. In contrast, acetaldehyde significantly increased the production of collagen type I, but did not alter the production of collagen type III, IV or laminin. Incorporation of 3H-proline into total protein was not affected by addition of ethanol or acetaldehyde to fat-storing cells or hepatocytes. Exposure of fat-storing cells to ethanol or acetaldehyde did not change 3H-collagen degrading activity in the media. We conclude that fat-storing cells are likely effector cells in the increased production of collagen type I in alcoholic liver fibrosis. (HEPATOLOGY 1990;12:511–518).