Liver fibrosis is a reversible wound‐healing response to injury reflecting the critical balance between liver repair and scar formation. Chronic damage leads to progressive substitution of liver parenchyma by scar tissue and ultimately results in liver cirrhosis. Stromal cells (hepatic stellate cells [HSC] and endothelial cells) have been proposed to control the balance between liver fibrosis and regeneration. Here, we show that endosialin, a C‐type lectin, expressed in the liver exclusively by HSC and portal fibroblasts, is upregulated in liver fibrosis in mouse and man. Chronic chemically induced liver damage resulted in reduced fibrosis and enhanced hepatocyte proliferation in endosialin‐deficient (EN^KO) mice. Correspondingly, acute‐liver‐damage‐induced hepatocyte proliferation (partial hepatectomy) was increased in EN^KO mice. A candidate‐based screen of known regulators of hepatocyte proliferation identified insulin‐like growth factor 2 (IGF2) as selectively endosialin‐dependent hepatocyte mitogen. Collectively, the study establishes a critical role of HSC in the reciprocal regulation of fibrogenesis vs. hepatocyte proliferation and identifies endosialin as a therapeutic target in non‐neoplastic settings.