Capillaria hepatica is a nematode parasite of wild rodents and other mammals. Adult worms inhabit the liver. Recently, during the necropsy examination of a group of 160 rabbits from a commercial supplier, firm pale or cystic areas (1-5 mm) were noted on the liver in thirteen animals. On further investigation, these animals were found to be infected with C. hepatica. The histopathological features of the infection in the rabbit are described for the first time and diagnostic features recorded. Lesions were identified predominantly in portal tracts consisting of dilated bile ducts with luminal debris, peribiliary inflammatory cell infiltrates, and fibrosis. Large granulomas (macrogranulomas) were evident in portal areas and involved the bile ducts. Macrogranulomas contained collections of characteristic C. hepatica eggs, macrophages, eosinophils, and lymphocytes. Small granulomas (microgranulomas), characterized by epithelioid macrophages surrounded by lymphocytes and eosinophils, were also identified. C. hepatica eggs were also observed in the lumina of the bile ducts and gall bladder. No adult C. hepatica worms were identified. Oocysts of Eimeria stiedae were also evident in the biliary epithelium in some animals. The unique characteristics of the C. hepatica life cycle are described, and the differential diagnosis of hepatic capillariasis is discussed.