Liver progenitor cells, characterized by the coexpression of biliary and hepatocyte lineage markers and the ability to form colonies in culture, were isolated by flow cytometry from primary human fetal livers. These prospectively isolated liver progenitor cells supported hepatitis D virus infection, expressed, and produced albumin and alpha-fetoprotein, as tracked by albumin- and alpha-fetoprotein-driven lentiviral promoter reporter constructs and measured by ELISA, respectively. Coculture in three-dimensional (3D) fibrin gel with endothelial cells resulted in the formation of vascular structures by the endothelial cells and increased proliferation of liver progenitors. The enhanced proliferation of liver progenitors that was observed when liver progenitors and endothelial cells were cultured in direct contact was not achieved when liver progenitors and endothelial cells were cultured on adjacent but separate matrices and when they were cultured across transwell membranes. In conclusion, coculture of liver progenitors and endothelial cells in three-dimensional matrix resulted in enhanced liver progenitor proliferation and function. This coculture methodology offers a novel coculture system that could be applied for the development of engineered liver tissues.