Mesenchymal stem cells or multipotent mesenchymal stromal cells (MSCs) have been extensively investigated in small animal models to treat both acute and chronic liver injuries. Mechanisms of action are not clearly elucidated but may include their ability to differentiate into hepatocyte-like cells, to reduce inflammation, and to enhance tissue repair at the site of injury. This approach is controversial and evidence in large animals is missing. Side effects of MSC infusion such as the contribution to a fibrotic process have been reported in experimental settings. Nevertheless, MSCs moved quickly from bench to bedside and over 280 clinical trials are registered, of which 28 focus on the treatment of liver diseases. If no severe side-effects were observed so far, long-term benefits remain uncertain. More preclinical data regarding mechanisms of action, long term safety and efficacy are warranted before initiating large scale clinical application. The proposal of this review is to visit the current state of knowledge regarding mechanisms behind the therapeutic effects of MSCs in the treatment of experimental liver diseases, to address questions about efficacy and risk, and to discuss recent clinical advances involving MSC-based therapies.