To investigate toxicity and neoplastic potential from chronic exposure to perfluorooctanesulfonate (PFOS), a two-year toxicity and cancer bioassay was conducted with potassium PFOS (K⁺ PFOS) in male and female Sprague Dawley rats via dietary exposure at nominal K⁺ PFOS concentrations of 0, 0.5, 2, 5, and 20 μg/g (ppm) diet for up to 104 weeks. Additional groups were fed 20 ppm for the first 52 weeks, after which they were fed control diet through study termination (20 ppm Recovery groups). Scheduled interim sacrifices occurred on Weeks 4, 14, and 53, with terminal sacrifice between Weeks 103 and 106. K⁺ PFOS appeared to be well-tolerated, with some reductions in body weight occurring in treated rats relative to controls over certain study periods. Male rats experienced a statistically significant decreased trend in mortality with significantly increased survival to term at the two highest treatment levels. Decreased serum total cholesterol, especially in males, and increased serum urea nitrogen were consistent clinical chemistry observations that were clearly related to treatment. The principal non-neoplastic effect associated with K⁺ PFOS exposure was in livers of males and females and included hepatocellular hypertrophy, with proliferation of endoplasmic reticulum, vacuolation, and increased eosinophilic granulation of the cytoplasm. Statistically significant increases in hepatocellular adenoma were observed in males (p=0.046) and females (p=0.039) of the 20 ppm treatment group, and all of these tumors were observed in rats surviving to terminal sacrifice. The only hepatocellular carcinoma observed was in a 20 ppm dose group female. There were no treatment-related findings for thyroid tissue in rats fed K⁺ PFOS through study termination; however, male rats in the 20 ppm Recovery group had statistically significantly increased thyroid follicular cell adenoma, which was considered spurious. There was no evidence of kidney or bladder effects. In rats, the dietary dose estimated as the lower 95% confidence limit of the benchmark dose for a 10% increase in hepatic tumors was 8 ppm for both sexes. Recent mechanistic studies suggest a PPARα/CAR/PXR-mediated mode of action for the liver tumors observed in the present two-year study.