Liver fibrosis occurs as a consequence of net accumulation of matrix proteins (especially collagen types I and III) in response to liver injury. The pathogenesis of liver fibrosis is underpinned by the activation of hepatic stellate cells (HSC) to a myofibroblast like phenotype with a consequent increase in their synthesis of matrix proteins such as interstitial collagens that characterise fibrosis. In addition to this there is increasing evidence that liver fibrosis is a dynamic pathologic process in which altered matrix degradation may also play a major role. Extracellular degradation of matrix proteins is regulated by matrix metalloproteinases (MMPS)- produced by HSC--which in turn are regulated by several mechanisms which include regulation at the level of the gene (transcription and proenzyme synthesis), cleavage of the proenzyme to an active form and specific inhibition of activated forms by tissue inhibitors of metalloproteinases (TIMPS). Insights gained into the molecular regulation of HSC activation will lead to therapeutic approaches in treatment of hepatic fibrosis in the future, and could lead to reduced morbidity and mortality in patients with chronic liver injury.