Mesenchymal stem cells (MSCs) have the capacity to restore liver function by differentiating into hepatocyte like cells. However, the underlying mechanisms are not well understood. Here, we have investigated the signals involved in the hepatic differentiation of human umbilical cord-derived mesenchymal stem cells (hUCMSCs). hUCMSCs were treated with mouse fetal liver-conditioned medium (FLCM) to induce hepatic differentiation. Flow cytometry, reverse transcription PCR, real-time PCR, immunocytochemistry, and polymerase chain reaction (PCR) array were used to detect the expression of MSC-and hepotocyte-specific markers in FLCM-treated hUCMSCs. Urea production and cytochrome P450 3A4 (CYP3A4) activity were used as indicators to evaluate liver cell characteristics. Raf/mitogen-activated protein kinase kinase (MEK)/extracellular signal-regulated kinase (ERK) was analyzed in hUCMSCs by Western blotting. Following FLCM treatment, expression of MSC-specific markers decreased, while hepatocytespecific gene expression was increased. Urea production, albumin secretion, glycogen storage, and CYP3A4 activity were significantly enhanced in FLCM-treated cells. In addition, ERK1/2 phosphorylation was increased in a time-dependent manner through Raf/MEK/ERK pathway, and phosphorylation was sustained at a high level during hepatic induction. Inhibition of ERK1/2 activation by U0126 (an ERK1/2 inhibitor) and pFLAG-CMV-ERK1(K71R) (negative mutant of ERK1) reversed the expression of liver-specific genes in hUCMSCs and affected hepatic function significantly. In summary, this work shows that ERK1/2 phosphorylation plays an important role in inducing hepatic differentiation of hUCMSCs in FLCM.