Background and Aims: Alagille syndrome (ALGS) is a pediatric genetic disorder, caused by mutations in the Notch ligand JAGGED1, presenting with cholestasis due to intrahepatic bile duct paucity. Despite chronic liver disease, few patients develop severe fibrosis or liver cancer, compared to other chronic liver diseases. In contrast, about 1/3 of ALGS patients suffer from reoccurring infections. Notch signaling regulates both liver and immune system development, but how immune system defects interact with liver pathology in ALGS to influence disease course is not known. Here, we aimed to determine whether a mouse model of ALGS mimics fibrosis and liver cancer, and whether ALGS immune system compromise could positively modulate inflammation or liver disease course. Methods: We used single cell RNA sequencing and 25-color flow cytometry to characterize cell populations in embryonic and postnatal liver in an ALGS mouse model (Jag1Ndr/Ndr mice). We analyzed liver cancer prevalence in Jag1Ndr/Ndr mice, in a cancer-prone genetic background, and thymic and spleen cell composition using flow cytometry. Finally, to test the functionality of the Jag1Ndr/Ndr immune system we performed adaptive immune cell transfer experiments into Rag1-/- mice and assessed inflammatory capacity in an ulcerative colitis model and in a DDC model of hepatocellular damage. Results: Adult Jag1Ndr/Ndr mice do not develop liver tumors (0%) while 45% of control mice do. Interestingly, Jag1Ndr/Ndr mice display ALGS-like chicken-wire hepatocellular fibrosis concomitant with mild inflammation shortly after the onset of liver cholestasis. Comprehensive single cell analysis revealed that liver CD4+ and CD8+ T cells of Jag1Ndr/Ndr mice are dysregulated in favor of CD4+, and Regulatory T-cells (Tregs) manifest reduced activation. Trans-plantation experiments show no difference between Jag1Ndr/Ndr and Jag1+/+ lymphocytes in DDC-induced liver damage. In contrast, Jag1Ndr/Ndr lymphocytes do not mount an inflammatory response to bacterial infection. Conclusion: Here we report immune dysregulation and cancer protection in the hypomorphic Jag1 mouse model of ALGS. Disrupted thymocyte differentiation coincides with limited activation of hepatocytes, blunting the inflammatory response to cholestasis. This may contribute to the pericellular fibrosis and prevent carcinogenesis. These results prompt the question of the relative contribution of Jag1 to liver cell pathology vs immune system in ALGS and high-light the need of future studies focused on dissecting apart how Jag1 modulates susceptibility to infection versus cancer risk.