Development and regression of liver fibrosis and cirrhosis induced by CCl4 in male F-344 rats were strictly followed during and after an 8-week treatment. The relative amount of collagen was measured by morphometry and the number of glycosaminoglycan (GAG) containing fat storing cells was counted at each time point. The expression of proteoglycan genes (decorin, versican and BPG-5 HSPG) was studied in parallel with the development of cirrhosis. Collagen content of the liver as well as the number of GAG-containing mesenchymal (fat storing) cells increased in parallel until two weeks after the cessation of CCl4 treatment. Later, both the collagen content and the number of GAG-containing cells decreased in parallel and significantly. Proteoglycan gene expression in the nonparenchymal fraction of liver cells indicated an active proteoglycan synthesis in the course of the development of cirrhosis. It is concluded that modified Ito (fat storing) cells synthesize proteoglycans and play an important role in the formation of connective tissue fibers in liver fibrosis.