Gut-derived lipopolysaccharide (LPS) plays a role in the pathogenesis of liver diseases like fibrosis. The enzyme alkaline phosphatase (AP) is present in, amongst others, the intestinal wall and the liver and was previously shown to dephosphorylate LPS. Therefore, we investigated the effect of LPS on hepatic AP expression and the effect of AP on LPS-induced hepatocyte responses. LPS-dephosphorylating activity was expressed at the hepatocyte canalicular membrane in normal and fibrotic animals. In addition to this, fibrotic animals also displayed high LPS-dephosphorylating activity around bile ducts. The enzyme was shown to dephosphorylate LPS from several bacterial species. LPS itself rapidly enhanced the intrahepatic mRNA levels for this enzyme within 2 hour by a factor 7. Furthermore, in vitro and in vivo studies showed that exogenous intestinal AP quickly bound to the asialoglycoprotein receptor on hepatocytes. This intestinal isoform significantly attenuated LPS-induced hepatic TNF and nitric oxide (NO_x) responses in vitro. The enzyme also reduced LPS-induced hepatic glycogenolysis in vivo. This study shows that LPS enhances AP expression in hepatocytes and that intestinal AP is rapidly taken up by these same cells, leading to an attenuation of LPS-induced responses in vivo. Gut-derived LPS-dephosphorylating activity or enzyme upregulation within hepatocytes by LPS may therefore be a protective mechanism within the liver.