The complex architecture of the liver is intertwined with its response to xenobiotic compounds. In particular, hepatocyte subpopulations are distributed along the sinusoid in zones 1 to 3, leading to prototypical "periportal" and "centrilobular" patterns of cell death in response to a toxic insult. In vitro models that more closely represent these zones of sub-specialization may therefore be valuable for the investigation of hepatic physiology and pathophysiology. We have established a perfused hepatocyte bioreactor that imposes physiologic oxygen gradients on co-cultures of rat hepatocytes and non-parenchymal cells, thereby producing an in vitro model of zonation. In order to predict and control oxygen gradients, oxygen transport in a parallel-plate bioreactor containing co-cultures was first mathematically modeled and experimentally validated. Co-cultures exposed to these physiologic oxygen gradients demonstrated regionally heterogeneity of CYP2B and CYP3A protein that mimics the distribution seen in the zonated liver. The distribution of CYP expression in the bioreactor was shown to vary with exposure to different chemical inducers and growth factors, providing a potential platform to study physiologic zonal responses. In order to explore zonal hepatotoxicity, bioreactors were perfused with APAP (acetominophen) for 24 h, resulting in maximal cell death at the low-oxygen outlet region similar to centrilobular necrotic patterns observed in vivo. This hepatocyte bioreactor system enables further in vitro investigation into zonation-dependent phenomena involving drug metabolism and toxicity.