Philosophic concepts and pragmatic approaches toward improved understanding of the effect of drugs in the hepatocyte are reviewed. No set pattern of studies is advocated but rather observations are encouraged within the framework of studies that provide for varied exposure of the hepatocyte. Clinical usage should be imitated to provide earliest possible indications of toxicity in man. The need for definitive characterization through utilization of appropriate methodology derived from cross-fertilization of related disciplines is stressed. Both minimal and maximal dose effects should be established. Selected use of electron microscopy has become essential for characterizing responses of the liver to injury. The advantages of the toluidine blue-stained Epon "thick" sections are emphasized. Such observations are used to implement the utility of serial biopsies from the beagle dog prior to and during long-term study of potential hepatic injury. Examples of the critical effects of drug concentration within the hepatocyte are presented.