Liver fibrosis is a pathological state marked by the excessive buildup of extracellular matrix due to persistent liver damage. Despite the potential of traditional medicines, including antiviral medications and lifestyle adjustments, to decelerate fibrosis progression, a completely effective treatment is still lacking. This article examines the function of human-induced pluripotent stem cells (hiPSCs) in mimicking liver fibrosis. HiPSCs can differentiate into multiple liver cell types, such as hepatocytes, hepatic stellate cells, and endothelial cells, facilitating the reconstruction of liver microarchitecture in both two-dimensional cultures and three-dimensional organoids. These technologies offer critical insights into the pathophysiological underpinnings of the disease, facilitate the discovery of therapeutic targets, and aid in the development of innovative antifibrotic drugs. The use of hiPSCs not only enables novel methods for disease modeling but also presents intriguing opportunities for more targeted and effective regenerative therapy for liver fibrosis.