Liver transplantation is the most common treatment for patients suffering from liver failure that is caused by congenital diseases, infectious agents, and environmental factors. Despite a high rate of patient survival following transplantation, organ availability remains the key limiting factor. As such, research has focused on the transplantation of different cell types that are capable of repopulating and restoring liver function. The best cellular mix capable of engrafting and proliferating over the long-term, as well as the optimal immunosuppression regimens, remain to be clearly well-defined. Hence, alternative strategies in the field of regenerative medicine have been explored. Since the discovery of induced pluripotent stem cells (iPSC) that have the potential of differentiating into a broad spectrum of cell types, many studies have reported the achievement of iPSCs differentiation into liver cells, such as hepatocytes, cholangiocytes, endothelial cells, and Kupffer cells. In parallel, an increasing interest in the study of self-assemble or matrix-guided three-dimensional (3D) organoids have paved the way for functional bioartificial livers. In this review, we will focus on the recent breakthroughs in the development of iPSCs-based liver organoids and the major drawbacks and challenges that need to be overcome for the development of future applications.