The liver has many crucial functions including metabolizing dietary molecules, detoxifying compounds, and storing glycogen. The hepatocytes, comprising most of the liver organ, progressively modify their gene expression profile during the fetal development according to their roles in the different phases of development. Embryonic stem (ES) cells serve as a major tool in understanding liver development. These cells may also serve as a source of hepatic cells for cellular therapy. In this review, we aim to summarize the research that has been performed in the field of hepatocyte differentiation from mouse and human ES cells. We discuss the various methodologies for the differentiation of ES cells towards hepatic cells using either spontaneous or directed differentiation protocols. Although many protocols for differentiating ES cells to hepatic cells have been developed, the analysis of their status is not trivial and can lead to various conclusions. Hence, we discuss the issues of analyzing hepatocytes by means of the specificity of the markers for hepatocytes and the status of the cells as fetal or adult hepatocytes. © 2005 Wiley-Liss, Inc.