Changes in enzyme activity due to induction by chemicals is an important property that can determine the type of response seen in tissues exposed to environmental chemicals. Two major types of response, acute irreversible liver cell injury or death (necrosis) and long-term cancer induction, are discussed in terms of their modulation by enzyme induction. Most commonly, enzyme induction leads to a more severe toxic response by the liver, and to more cell death. However, inducers may have a protective effect, especially in carcinogenesis, when they most frequently protect against cancer induction if used early in the process. There is a discrepancy between this observation and the increase in mutagenic activity of liver preparations observed after induction. However, when enzyme induction occurs at a later stage, after initiation, it often accelerates or promotes cancer induction. Also, new cell populations constantly observed during liver carcinogenesis are composed of very hypertrophic hepatocytes containing a large amount of smooth endoplasmic reticulum. This is associated with a radical change in enzyme activities in the reticulum, which may account in part for the characteristic resistance exhibited by initiated cells to hepatotoxins and carcinogens. The resistance is considered to be an important property that may play a key role in the development of cancer under some circumstances.