The outcome of liver injury is dictated by the effectiveness of repair. Successful repair (i.e., regeneration) results in replacement of dead epithelial cells with healthy epithelial cells, and reconstructs normal hepatic structure and function. Liver regeneration is known to involve replication of surviving mature hepatocytes and bile duct cells. This review discusses recent evidence for other mechanisms that might also replace dead hepatic epithelial cells and repair liver damage, particularly during chronic injury. According to this theory, certain epithelial cells in developing livers and/or injured adult livers undergo epithelial-to-mesenchymal transition (EMT) and move into the hepatic mesenchyme where they exhibit fibroblastic features. Some of these epithelia-derived mesenchymal cells, however, may be capable of undergoing subsequent mesenchymal-to-epithelial transition (MET), reverting to epithelial cells that ultimately become hepatocytes or cholangiocytes. Although these concepts remain to be proven, the theory predicts that the balance between EMT and MET modulates the outcome of chronic liver injury. When EMT activity outstrips MET, repair is mainly fibrogenic, causing liver fibrosis. Conversely, predominance of MET favors more normal liver regeneration. In this review, we summarize evidence that certain resident liver cells are capable of EMTs in vitro and during chronic liver injury.