Bone morphogenic protein-7 (BMP-7) is a key protein involved in liver organogenesis and development. The physiological circulating concentration of BMP-7 is between 100 and 300 pg/ml. BMP-7 expression is absent in the liver, but the receptors for BMP-7 are present on adult hepatocytes. Therefore, we hypothesized that BMP-7 might function as an endogenous regulator of adult hepatocyte proliferation and liver homeostasis. Here, we demonstrate that neutralization of circulating endogenous BMP-7 results in significantly impaired regeneration of the liver after partial hepatectomy. Therapeutic administration of recombinant human BMP-7 (rhBMP-7) significantly enhances liver regeneration associated with accelerated improvement of liver function. Collectively, our results argue for the role of BMP-7 as a kidney- and bone-produced endogenous regulator of hepatocyte health.