These studies demonstrate that the MH(1)C(1) strain of rat hepatoma cells has the ability to take up and conjugate bilirubin and then excrete the conjugated pigment into the culture medium. On incubation with unconjugated bilirubin, the average rate of appearance of conjugated bilirubin in the medium was 4.4 +/- 0.20 microg per mg of cell protein per hour (mean +/- SE). The products formed from bilirubin by MH(1)C(1) cells were chromatographically identical to those found in normal rat bile. Assay of bilirubin UDP glucuronyl transferase activity in homogenates of MH(1)C(1) cells gave a value of 3.3 +/- 0.50 microg of conjugated pigment formed per mg protein per hour, only moderately less than the enzyme activity of liver from normal rats. Rat fibroblasts in culture did not conjugate bilirubin, nor did they contain bilirubin UDP-glucuronyl transferase activity. As in living animals, flavaspidic acid inhibited bilirubin metabolism by MH(1)C(1) cells, suggesting that the mechanism for bilirubin uptake is similar to that of normal liver. In contrast to the findings in animals, however, preincubation of MH(1)C(1) cells with phenobarbital led to only minimal enhancement of pigment conjugation. MH(1)C(1) cells represent the first example of a clonal strain of cells in culture in which many of the pathways of hepatic bilirubin metabolism remain intact. They should, therefore, serve as a useful model for studies of bile pigment metabolism which are not easily performed in the living animal.