The bile salt export pump (Bsep) mediates the hepatic excretion of bile acids, and its deficiency causes progressive familial intrahepatic cholestasis. The current study aimed to induce bile acid stress in Bsep−/− mice and to test the efficacy of hepatocyte transplantation in this disease model. We fed Bsep−/− and wild-type mice cholic acid (CA) or ursodeoxycholic acid (UDCA). Both CA and UDCA caused cholestasis and apoptosis in the Bsep−/− mouse liver. Wild-type mice had minimal liver injury and apoptosis when fed CA or UDCA, yet had increased proliferative activity. On the basis of the differential cytotoxicity of bile acids on the livers of wild-type and Bsep−/− mice, we transplanted wild-type hepatocytes into the liver of Bsep−/− mice fed CA or CA + UDCA. After 1–6 weeks, the donor cell repopulation and canalicular Bsep distribution were documented. An improved repopulation efficiency in the CA + UDCA-supplemented group was found at 2 weeks (4.76 ± 5.93% vs. 1.32 ± 1.48%, P = 0.0026) and at 4–6 weeks (12.09 ± 14.67% vs. 1.55 ± 1.28%, P < 0.001) compared with the CA-supplemented group. Normal-appearing hepatocytes with prominent nuclear staining for FXR were noted in the repopulated donor nodules. After hepatocyte transplantation, biliary total bile acids increased from 24% to 82% of the wild-type levels, among which trihydroxylated bile acids increased from 41% to 79% in the Bsep−/− mice. We conclude that bile acid stress triggers differential injury responses in the Bsep−/− and wild-type hepatocytes. This strategy changed the balance of the donor–recipient growth capacities and was critical for successful donor repopulation.