The liver and pancreas develop from the embryonic endoderm, and the progenitor cells that give rise to these organs are specified and regulated by transcription factor expression. Members of the GATA and HNF-3/FoxA families function during the early stages of both hepatic and pancreatic progenitor cell specification. Other transcription factors, such as PDX-1/IPF1, promote the differentiation of pancreatic progenitor cells into all cell types of the mature pancreas including exocrine, endocrine, and ductal cells. Similarly, hepatic progenitor cell differentiation into hepatocytes and cholangiocytes is regulated by transcription factors such as TBX3. Hepatic progenitor cell proliferation is stimulated by Prox1 expression, but whether these cells have unlimited self-renewal potential is an area of current investigation. A greater understanding of the transcription factors that regulate hepatic and pancreatic progenitor cell proliferation and differentiation has clinical relevance for treating chronic liver diseases and diabetes.