Disruption of the gene encoding for the transcription coactivator peroxisome proliferator-activated receptor (PPAR)-binding protein (PBP/TRAP220/DRIP205/Med1) in the mouse results in embryonic lethality. Here, we have reported that targeted disruption of the Pbp/Pparbp gene in hepatocytes (Pbp(DeltaLiv)) impairs liver regeneration with low survival after partial hepatectomy. Analysis of cell cycle progression suggests a defective exit from quiescence, reduced BrdUrd incorporation, and diminished entry into G(2)/M phase in Pbp(DeltaLiv) hepatocytes after partial hepatectomy. Pbp(DeltaLiv) hepatocytes failed to respond to hepatocyte growth factor/scatter factor, implying that hepatic PBP deficiency affects c-met signaling. Pbp gene disruption also abolishes primary mitogen-induced liver cell proliferative response. Striking abrogation of CCl(4)-induced hepatocellular proliferation and hepatotoxicity occurred in Pbp(DeltaLiv) mice pretreated with phenobarbital due to lack of expression of xenobiotic metabolizing enzymes necessary for CCl(4) activation. Pbp(DeltaLiv) mice, chronically exposed to Wy-14,643, a PPARalpha ligand, revealed a striking proliferative response and clonal expansion of a few Pbp(fl/fl) hepatocytes that escaped Cre-mediated gene deletion in Pbp(DeltaLiv) livers, but no proliferative expansion of PBP null hepatocytes was observed. In these Pbp(DeltaLiv) mice, none of the Wy-14,643-induced hepatic adenomas and hepatocellular carcinomas was derived from PBP(DeltaLiv) hepatocytes; all liver tumors developing in Pbp(DeltaLiv) mice maintained non-recombinant Pbp alleles and retained PBP expression. These studies provide direct evidence in support of a critical role of PBP/TRAP220 in liver regeneration, induction of hepatotoxicity, and hepatocarcinogenesis.