Background: IDH1 mutations occur in approximately 13% of intrahepatic cholangiocarcinomas (IHCCs). The oral, targeted, mutant IDH1 (mIDH1) inhibitor ivosidenib (AG-120) suppresses production of the oncometabolite D-2-hydroxyglutarate, promoting disease stabilization and improved progression-free survival (PFS) in mIDH1 IHCC. Materials & methods: Harnessing matched baseline and on-treatment biopsies, we investigate the potential mechanisms underlying ivosidenib's efficacy. Results: mIDH1 inhibition leads to decreased cytoplasm and expression of hepatocyte lineage markers in patients with prolonged PFS. These findings are accompanied by downregulation of biliary fate, cell cycle progression and AKT pathway activity. Conclusion: Ivosidenib stimulates a hepatocyte differentiation program in mIDH1 IHCC, a phenotype associated with clinical benefit. mIDH1 inhibition could be a paradigm for differentiation-based therapy in solid tumors. Clinical trial registration: NCT02073994 (ClinicalTrials.gov).