Engineering functional activity of liver cell cultures requires the modulation of specific cell-cell interactions. We have investigated the quantitative role of systematically varied presentation of the cell-cell adhesion molecule, E-cadherin, on the differentiated function of cocultured parenchymal liver cells, hepatocytes. Specifically, we incorporated different proportions of E-cadherin transfected L-929 chaperone cells and untransfected chaperone cells, within cultures of primary rat hepatocytes on a collagen substrate. By using a strongly adhesive substrate that restricted cadherin-induced variations in cell spreading and growth-arresting chaperone cells, we could carefully isolate the potential role of cell-cell adhesion on cell differentiation. Using immunofluorescence microscopy, we confirmed that cadherins expressed at hepatocyte-hepatocyte contacts as well as hepatocyte-chaperone contacts were crossreactive. However, hepatocytes cocultured with cadherin-presenting chaperone cells had a 55-65% increase in longterm function over hepatocytes cocultured with control, nonpresenting chaperone cells. Notably, the cadherin-induced increase in function occurred over and above the basal, coculture-induced functional elevation. Further, we quantified the stoichiometric importance of cadherin contacts by comparing established markers of hepatocyte functional activity across a graded range of E-cadherin presentation. At low levels of cadherin-mediated contacts, the induction of differentiated function was weak, while high levels of contacts elicited a marked increase in function. Thus, hepatocyte biochemical functions (albumin and urea secretion) were biphasically governed by the degree of cadherin-based contacts presented during culture. Overall, our results demonstrate the unequivocal role of cell-cell adhesion molecules in hepatocyte functional engineering, through the graded use of cadherin presentation from functionally incompetent, heterotypic chaperone cells.