Focal nodular hyperplasia is a tumour like lesion, characterized by a central fibrous scar with irradiating fibrous septa that surround hyperplastic nodules and contain multiple bile ductules. The origin of the bile ductular structures is not clear. Recently, we found evidence for the existence of human counterparts of rat oval cells (potential stem cells) that have the ability of differentiating towards both bile duct cells and hepatocytes. These cells were found in regenerating human liver as well as in chronic cholestatic conditions. Because cholestatic features are seen in focal nodular hyperplasia, we initiated an immunohistochemical study on 23 surgical specimens using antibodies specific for cytokeratins 7 and 19 (bile duct type cytokeratins), OV6 (rat oval cell marker), chromogranin-A (shown to be positive in reactive bile ductules and human oval-like cells) and neural cell adhesion molecule—NCAM (shown to be positive in reactive bile ductules) to investigate whether ‘undifferentiated progenitor cells’ are also present in focal nodular hyperplasia. Electronmicroscopy was applied in five cases. Bile ductules invariably showed immunoreactivity for CK7 and 19, OV6, chromogranin-A and NCAM. In addition, small individual cells with an oval nucleus and a small rim of cytoplasm, in the vicinity of the septa, were immunoreactive for chromogranin-A, CK7 and 19 and OV6. These cells were hardly recognizable on routine light microscopy. Clusters of periseptal hepatocytes, seemingly in continuity with bile ductular structures, had a transitional phenotype: they stained positive for chromogranin-A, CK7 and OV6 and sometimes formed liver cell rosettes. The number of OV6-positive hepatocytes was greater than the number of chromogranin-A and CK7 positive hepatocytes. This indicates that, in human liver, OV-6 is not purely a marker of progenitor cells. Ultrastructurally, small immature cells, highly resembling rat oval cells, were recognized in the vicinity of septa. In addition, transitional cells displaying characteristics both of hepatocytes and bile duct cells were also present. These results confirm the presence of ‘undifferentiated progenitor cells’ in focal nodular hyperplasia and suggest that the ductular reaction in these lesions results, at least partly, from activation of these cells.