The high regenerative capacity of liver contributes to the maintenance of its size and function when injury occurs. Partial hepatectomy induces division of mature hepatocytes to maintain liver function, whereas severe injury stimulates expansion of undifferentiated hepatic precursor cells, which supply mature cells. Although several factors reportedly function in liver regeneration, the precise mechanisms underlying regeneration remain unclear. In this study, we analyzed expression of nucleostemin (NS) during development and in injured liver by using transgenic green fluorescent protein reporter (NS-GFP Tg) mice. In neonatal liver, the hepatic precursor cells that give rise to mature hepatocytes were enriched in a cell population expressing high levels of NS. In adult liver, NS was abundantly expressed in mature hepatocytes and rapidly upregulated by partial hepatectomy. Severe liver injury promoted by a diet containing 3,5-diethoxycarbonyl-1,4-dihydrocollidine induced the emergence of NS-expressing ductal epithelial cells as hepatic precursor cells. NS knockdown inhibited both hepatic colony formation in vitro and proliferation of hepatocytes in vivo. These data strongly suggest that NS plays a critical role in regeneration of both hepatic precursor cells and hepatocytes in response to liver injury.