Liver injury due to bile duct ligation (BDL) is histologically characterized by cholestasis, bile ductular proliferation, hepatocellular damage, portal fibrosis, and ultimately biliary cirrhosis. Stem cells within the liver may act as progenitor cells for small epithelial cells termed oval cells that can differentiate into bile duct cells or hepatocytes, whereas myofibroblasts are the principal source of collagen production in fibrosis. The aims of this study were to determine 1) whether BDL induces oval cell proliferation and 2) whether blockade of Kupffer cells affects oval cell proliferation, bile duct proliferation, and myofibroblast transformation in experimental biliary obstruction. Male Sprague-Dawley rats were divided into two groups to receive either a single dose of gadolinium chloride (a selective Kupffer cell blocking agent) or vehicle. One day later, the gadolinium- and vehicle-treated groups were further subdivided to receive either BDL or sham operation. The rats were sacrificed on day 7 postoperatively. Serum was collected for measurement of aspartate aminotransferase, gamma-glutamyl transpeptidase, and bilirubin levels. Liver tissue was taken for evaluation of fibrosis, bile ductular cells, oval cells, and myofibroblasts. BDL resulted in elevated aspartate aminotransferase, gamma-glutamyl transpeptidase, and bilirubin in serum, and gadolinium pretreatment did not modify these effects. BDL induced marked oval cell proliferation, which was completely prevented by gadolinium pretreatment. Gadolinium did not affect the induction of bile duct expansion or myofibroblasts after BDL. We conclude that experimental biliary obstruction induces oval cell proliferation, which can be prevented by gadolinium pretreatment. This suggests that bile ductular proliferation and myofibroblast transformation are not mediated by Kupffer cells and that ductular proliferation can proceed in the absence of oval cells. Alternatively, gadolinium may directly affect oval cell proliferation after BDL.