The question whether hepatic stem cells exist or not has been debated for several decades. Current researches confirmthat there are hepatic stem cells in the liver. Oval cells, putative bipotential hepatic stem cells, are probably located within canals of Her-ing, portal tracts or branches of biliary trees. Bone marrow is a potential source of oval cells, indicating that there exists a close relationshipbetween liver and hematopoiesis in adulthood. Hepatic stem cells are able to proliferate in vitro and can be induced to differentiate intohepatocytes. This will provide a promising approach of cell transplantation, tissue engineering and gene therapy for liver diseases. In thisreview, the evidence of their presence, origin, identification, proliferation in vitro, differentiation by induction, application prospects ofhepatic stem cells and future directions for the field are discussed. The question whether hepatic stem cells exist or not has been debated for several decades. Current researches confirmthat there are hepatic stem cells in the liver. Oval cells, putative bipotential hepatic stem cells, are likely located within canals of Her-ing, portal tracts or Branches of biliary trees. Bone marrow is a potential source of oval cells, indicating that there exists exists a close relationship between liver and hematopoiesis in adulthood. Hepatic stem cells are able to proliferate in vitro and can be induced to differentiate into hepatocytes. This will provide promising approach of cell transplantation, tissue engineering and gene therapy for liver diseases. In this review, the evidence of their presence, origin, identification, proliferation in vitro, differentiation by induction, application prospects of hepatic stem cells and future directions for the field are discussed.