The liver, like most organs in an adult healthy body, maintains a perfect balance between cell gain and cell loss. Though normally proliferatively quiescent, simple hepatocyte loss such as that caused by partial hepatectomy, uncomplicated by virus infection or inflammation, invokes a rapid regenerative response to restore liver mass. This restoration of moderate cell loss and 'wear and tear' renewal is largely achieved by hepatocyte self-replication. Furthermore, cell transplant models have shown that hepatocytes can undergo significant clonal expansion. Such observations indicate that hepatocytes are the functional stem cells of the liver. More severe liver injury activates a facultative stem cell compartment located within the intrahepatic biliary tree, giving rise to cords of biliary epithelia within the lobules before these cells differentiate into hepatocytes. A third population of stem cells with hepatic potential resides in the bone marrow; these haematopoietic stem cells can contribute to the albeit low renewal rate of hepatocytes, make a more significant contribution to regeneration, and even completely restore normal function in a murine model of hereditary tyrosinaemia. How these three stem cell populations integrate to achieve a homeostatic balance is not understood. This review focuses on three aspects of liver stem cell biology: 1) the hepatic stem cell candidates; 2) models of cell transplantation into the liver; and 3) the therapeutic potential of hepatic stem cells.