The effect of azathioprine at 40 mg. per kilogram per day (LD25 at four days) was studied in rats following excision of two thirds of the liver. 1. The restoration of liver mass after four days was unchanged. 2. The rate of DNA synthesis was inhibited by a factor of 100 on the first day. DNA concentration decreased 24 percent by two days and 38 percent by four days in comparison with nontreated rats. 3. The rate of RNA synthesis was at first depressed, then accelerated. RNA concentrations were normal at four days. 4. The ratio of RNA to DNA was increased 59 percent at four days. 5. Hepatic regeneration was chiefly by cellular hypertrophy rather than by hyperplasia.