During the evolution of cirrhosis, there is a relative decrease in volume percentage of hepatocytes and a relative increase in biliary epithelial cells and myofibroblasts. This is recognized histopathologically as a ductular reaction and leads to gradual distortion of the normal hepatic architecture. The final or decompensated stage of cirrhosis is characterized by a further decline in hepatocyte proliferation and loss of functional liver mass that manifests clinically as ascites, encephalopathy, and other signs of liver failure. In this report, we tested the hypothesis that p21-mediated hepatocyte mito-inhibition accelerates the evolution of cirrhosis using an established mouse model of decompensated biliary cirrhosis, p21-deficient mice, and liver tissue from humans awaiting liver replacement. Despite the same insult of long-term (12-week) bile duct ligation, mice prone to decompensation showed significantly more oxidative stress and hepatocyte nuclear p21 expression, which resulted in less hepatocyte proliferation, an exaggerated ductular reaction, and more advanced disease compared with compensation-prone controls. Mice deficient in p21 were better able than wild-type controls to compensate for long-term bile duct ligation because of significantly greater hepatocyte proliferation, which led to a larger liver mass and less architectural distortion. Mito-inhibitory hepatocyte nuclear p21 expression in humans awaiting liver replacement directly correlated with pathological disease stage and model of end-stage liver disease scoring. In conclusion, stress-induced upregulation of hepatocyte p21 inhibits hepatocyte proliferation during the evolution of cirrhosis. These findings have implications for understanding the evolution of cirrhosis and associated carcinogenesis. Supplementary material for this article can be found on the HEPATOLOGY website (http://interscience.wiley.com/jpages/0270-9139/suppmat/index.html).