Rat hepatocytes immobilized in calcium-alginate beads were tested for their ability to survive and function in vitro by comparison with hepatocyte monolayer cultures before and after cryopreservation. The freeze-thaw protocol previously designed for suspended hepatocytes was used; the freezing medium was the Leibovitz medium containing 10% fetal calf serum and 16% dimethylsulfoxide. The functions investigated included protein, lipid, and urea synthesis, albumin secretion, glycogen content, and various phase I and phase II enzyme activities. Cell viability was not altered by immobilization and the freeze-thaw procedure. Most functions tested were expressed at similar levels in unfrozen immobilized hepatocytes and corresponding hepatocyte monolayers. Only protein neosynthesis and some phase II drug metabolizing enzyme activities were decreased. The freeze-thaw process had no detrimental effect, whatever the function investigated. In addition, cryopreserved immobilized hepatocytes remained responsive to inducers: ethoxyresorufin O-deethylase activity was increased 11-12 times by 3-methylcholanthrene treatment in both fresh and cryopreserved alginate-entrapped hepatocytes. These results clearly show that hepatocytes immobilized in calcium-alginate beads remain functional even after cryopreservation indicating that they represent a promising approach for xenobiotic metabolism and toxicity studies.