Previous studies have demonstrated that alginate encapsulation of proliferating hepatocyte-derived cell lines (e.g., HepG2 cells) enhances the expression of differentiated hepatocyte function compared with conventional monolayer culture. Furthermore, such capsules have the advantage of cryopreservability, and can be readily manipulated, e.g., for the charging of extracorporeal devices. We utilize a rabbit model of acute liver failure caused by acetaminophen administration to rabbits pretreated to enhance cytochrome p450 enzyme activity, and demonstrate that encapsulated HepG2 cells, in an extracorporeal chamber, perfused by rabbit plasma separated on-line at a rate of 2-5 mL/min, and perfused over cells at 40-60 mL/min, improve systemic parameters of liver failure (diastolic blood pressure and transjugular venous oxygen saturation). Such encapsulated cells have the potential to be developed for extracorporeal liver support systems for acute liver failure.