In physiology, reactive oxygen species (ROS) are produced by most cells for normal function and as a defense mechanism against foreign particles, microbes and viruses. Hepatic macrophages (Kupffer cells), sinusoidal endothelial cells, hepatocytes and hepatic stellate cells (HSCs) are all capable of generating ROS in physiology and pathology. ROS are also produced by infiltrating inflammatory cells during acute and chronic liver injury. Increased levels of ROS have been implicated in apoptotic/necrotic death of hepatocytes, and liver failure. In contrast to causing injury to hepatocytes, ROS and lipid peroxidation products induce transdifferentiation of the quiescent HSCs into an activated highly proliferative myofibroblast-like phenotype. ROS and lipid peroxidation products also stimulate the synthesis of extracellular matrix (ECM) by activated HSCs. Deposition of excessive amounts of ECM is the primary mechanism of fibrosis and cirrhosis of the liver, and interactions between ROS and HSCs appear to play a major role in this pathology. Although these findings suggest that HSCs are resistant to the injurious actions of ROS, there is compelling evidence demonstrating ROS-induced death of activated HSCs. Detailed mechanistic understanding of such paradoxical interactions between ROS and HSCs will be critical for developing therapies for chronic fibrotic liver disease.