Transplants of isolated syngeneic and allogeneic hepatocytes are rapidly disintegrated, irrespective of the site of engraftment; be it spleen, liver, portal vein, peritoneum, or subcutaneous tissue. Host scavenger cells are responsible for this reaction. We designed a method overcoming early disintegration of the grafted hepatocytes. It consisted of administration of anti-asialoGM1 antiserum eliminating natural killer cells; sublethal whole body irradiation; and reconstitution with syngeneic bone marrow cells, ligation of host bile duct, intrasplenic hepatocyte transplantation, and three consecutive partial hepatectomies. Six months after transplantation a glycogen-rich, trabeculae-forming, dividing hepatocytes, situated along strands of newly-formed fibrous tissue and numerous dilated blind bile cannaliculae were observed. There was evidently more bile canaliculae in hosts with ligated bile duct than nonligated controls. This is the first study showing fibrous tissue formed at the site of hepatocyte implantation, and stellate cells are presumably involved in this process.