Fumonisin B1 (FB1) is a naturally occurring mycotoxin produced by Fusarium verticillioides. Dietary exposure to FB1 has been linked to human cancer in certain parts of the world, and treatment with FB1 causes oval cell proliferation and liver tumors in rats. To study the potential role of oval (liver progenitor) cells in the cellular pathogenesis of FB1-induced liver tumors, we gave male F344 rats prolonged treatment with FB1 for 25 weeks, followed by return to control diet until 50 weeks (‘stop study’). The time course of FB1-induced liver lesions was followed by examination of serial liver biopsies at set time intervals and post-mortem liver tissue at the end of the study. The effects of different FB1 treatment regimens (5 versus 25 weeks), as well as the modulating effect of 2-acetylaminofluorene (2-AAF), on the kinetics of oval cell proliferation and development of liver tumors were compared. Prolonged treatment with FB1 in normal diet caused persistent oval cell proliferation and generation of both hepatic adenomas and cholangiofibromas (CFs). These liver lesions occurred in the setting of chronic toxic hepatitis and liver fibrosis/cirrhosis, similar to that seen in human hepatocarcinogenesis. Some adenomas and CFs were dysplastic, and one post-mortem liver contained a hepatocellular carcinoma. OV-6+ oval cells were noted in close relation to proliferative neoplastic liver lesions, and some of these lesions expressed OV-6, suggesting that all these cell types were derived from a common progenitor cell. 2-AAF enhanced the size of FB1-induced glutathione S-transferase pi+ hepatocellular lesions and the incidence of CFs in post-mortem liver specimens, but this was not statistically significant. In conclusion, this study supports the involvement of dietary FB1 in liver carcinogenesis in male F344 rats. Oval cells may be the source of both the hepatocellular and cholangiocellular tumors induced by prolonged treatment with FB1. 2-AAF appears to have an enhancing effect on FB1-induced liver tumors, presumably due to its potent inhibitory effects on hepatocyte regeneration.