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In vitro primary hepatocyte systems typically elicit drug induction and toxicity responses at concentrations much higher than corresponding in vivo or clinical plasma Cmax levels, contributing to poor in vitro-in vivo correlations. This may be partly due to the absence of physiological parameters that maintain metabolic phenotype in vivo. We hypothesized that restoring hemodynamics and media transport would improve hepatocyte architecture and metabolic function in vitro compared with nonflow cultures. Rat hepatocytes were cultured for 2 wk either in nonflow collagen gel sandwiches with 48-h media changes or under controlled hemodynamics mimicking sinusoidal circulation within a perfused Transwell device. Phenotypic, functional, and metabolic parameters were assessed at multiple times. Hepatocytes in the devices exhibited polarized morphology, retention of differentiation markers [E-cadherin and hepatocyte nuclear factor-4α (HNF-4α)], the canalicular transporter [multidrug-resistant protein-2 (Mrp-2)], and significantly higher levels of liver function compared with nonflow cultures over 2 wk (albumin ∼4-fold and urea ∼5-fold). Gene expression of cytochrome P450 (CYP) enzymes was significantly higher (fold increase over nonflow: CYP1A1: 53.5 ± 10.3; CYP1A2: 64.0 ± 15.1; CYP2B1: 15.2 ± 2.9; CYP2B2: 2.7 ± 0.8; CYP3A2: 4.0 ± 1.4) and translated to significantly higher basal enzyme activity (device vs. nonflow: CYP1A: 6.26 ± 2.41 vs. 0.42 ± 0.015; CYP1B: 3.47 ± 1.66 vs. 0.4 ± 0.09; CYP3A: 11.65 ± 4.70 vs. 2.43 ± 0.56) while retaining inducibility by 3-methylcholanthrene and dexamethasone (fold increase over DMSO: CYP1A = 27.33 and CYP3A = 4.94). These responses were observed at concentrations closer to plasma levels documented in vivo in rats. The retention of in vivo-like hepatocyte phenotype and metabolic function coupled with drug response at more physiological concentrations emphasizes the importance of restoring in vivo physiological transport parameters in vitro.