A patient with liver failure due to chronic and acute alcohol abuse under consideration for an urgent liver transplant shortly after stopping alcohol may have residual abnormalities that threaten transplant success, particularly for a small graft. To address this, we studied a model in which reduced-size (50%) Lewis rat livers are transplanted into green fluorescence protein transgenic Lewis recipients after they are fed alcohol or a control diet for 5 weeks. Here we show that normal small Lewis grafts transplanted to alcohol-fed Lewis hosts developed fibrosis, whereas no fibrosis was observed in control-fed recipients. Host-derived CD133 + 8-hydroxy-2'-deoxyguanosine (8-OHdG) cells were significantly increased in livers recovered from both alcohol-fed and control recipients, but only alcohol-fed recipients demonstrated co-staining (a marker of oxidative DNA damage). α smooth muscle actin (α-SMA) staining, a marker for myofibroblasts, also co-localized with CD133 + cells only in the livers of alcohol-fed recipients. Immunostaining and polymerase chain reaction analysis confirmed that chronic alcohol consumption decreased the proportion of bone marrow stem cells (BMSCs) expressing CD133, c-Kit, and chemokine (C-X-C motif) receptor 4 markers and caused oxidative mitochondria DNA (mtDNA) damage. Culture of CD133 + cells from normal rats with medium containing 3% ethanol for 48 hours resulted in elevated mitochondrial 8-OHdG and mtDNA deletion, and ethanol exposure diminished CD133 expression but dramatically increased α-SMA expression. In conclusion, oxidative mtDNA damage and deletions occur in BMSCs of chronic alcohol-fed recipients, and these damaged cells mobilize to the small liver grafts and become myofibroblasts where they play a key role in the subsequent development of fibrosis. Liver Transplantation 23 1564-1576 2017 AASLD.