Directed differentiation of human induced pluripotent stem cells (iPSCs) into hepatocytes could provide an unlimited source of liver cells, and therefore holds great promise for regenerative medicine, disease modeling, drug screening and toxicology studies. Various methods have been established during the past decade to differentiate human iPSCs into hepatocyte-like cells (HLCs) using growth factors and/or small molecules. However, direct comparison of the differentiation efficiency and the quality of the final HLCs between different methods has rarely been reported. In the current study, two hepatocyte differentiation methods were devised, termed Method 1 and 2, through modifying existing well-known hepatocyte differentiation strategies, and the resultant cells were compared phenotypically and functionally at different stages of hepatocyte differentiation. Compared to Method 1, higher differentiation efficiency and reproducibility were observed in Method 2, which generated highly homogeneous functional HLCs at the end of the differentiation process. The cells exhibited morphology closely resembling primary human hepatocytes and expressed high levels of hepatic protein markers. More importantly, these HLCs demonstrated several essential characteristics of mature hepatocytes, including major serum protein (albumin, fibronectin and α-1 antitrypsin) secretion, urea release, glycogen storage and inducible cytochrome P450 activity. Further transcriptomic comparison of the HLCs derived from the two methods identified 1,481 differentially expressed genes (DEGs); 290 Gene Ontology terms in the biological process category were enriched by these genes, which were further categorized into 34 functional classes. Pathway analysis of the DEGs identified several signaling pathways closely involved in hepatocyte differentiation of pluripotent stem cells, including ‘signaling pathways regulating pluripotency of stem cells’, ‘Wnt signaling pathway’, ‘TGF-beta signaling pathway’ and ‘PI3K-Akt signaling pathway’. These results may provide a molecular basis for the differences observed between the two differentiation methods and suggest ways to further improve hepatocyte differentiation in order to obtain more mature HLCs for biomedical applications.