Liver disease in alpha‐1‐antitrypsin (α1AT) deficiency is caused by a gain‐of‐toxic function mechanism engendered by the accumulation of a mutant glycoprotein in the endoplasmic reticulum (ER). The extraordinary degree of variation in phenotypical expression of this liver disease is believed to be determined by genetic modifiers and/or environmental factors that influence the intracellular disposal of the mutant glycoprotein or the signal transduction pathways that are activated. Recent investigations suggest that a specific repertoire of signaling pathways are involved, including the autophagic response, mitochondrial‐ and ER‐caspase activation, and nuclear factor kappaB (NFκB) activation. Whether activation of these signaling pathways, presumably to protect the cell, inadvertently contributes to liver injury or perhaps protects the cell from one injury and, in so doing, predisposes it to another type of injury, such as hepatocarcinogenesis, is not yet known. Recent studies also suggest that hepatocytes with marked accumulation of α1ATZ, globule‐containing hepatocytes, engender a cancer‐prone state by surviving with intrinsic damage and by chronically stimulating in ‘trans’ adjacent relatively undamaged hepatocytes that have a selective proliferative advantage. Further, this paradigm may apply to other genetic and infectious liver diseases that are predisposed to hepatocellular carcinoma. (HEPATOLOGY 2005.)