Laboratory fish species are used increasingly in biomedical research and are considered robust models for the study of regenerative processes. Studies investigating the response of the fish liver to injury have demonstrated the presence of a ductular reaction and oval-like cells in injured and regenerating liver. To date, however, it is unclear if this cell population is the piscine equivalent of oval cells (OCs) or intermediate hepatobiliary cells (IHBCs) identified in rodents and man, respectively. The present study defines the process of OC differentiation in fish liver using histopathology, immunohistochemistry and transmission electron microscopy. To generate OC proliferation in Japanese medaka (Oryzias latipes), hepatic injury was induced by exposure of adult fish to either microcystin LR or dimethylnitrosamine. A transgenic strain of medaka expressing a red fluorescent protein (RFP) exclusively in hepatocytes was used. The morphological response to injury was characterized by a ductular reaction comprised of cytokeratin (CK) AE1/AE3+ OCs progressing to IHBCs variably positive for CK and RFP and finally mature RFP+ hepatocytes and CK+ cholangiocytes. These observations support a bipotential differentiation pathway of fish OCs towards hepatocytes and cholangiocytes. Ultrastructural morphology confirmed the presence of OCs and differentiation towards hepatocytes. These results demonstrated clear similarities between patterns of reaction to injury in fish and mammalian livers. They also confirm the presence of, and support the putative bipotential lineage capabilities of, the fish OC.