Microfluidic technologies enable the fabrication of advanced in vitro systems incorporating liver tissue or cells to perform metabolism and toxicity studies for drugs and other xenobiotics. The use of microfluidics provides the possibility to utilize a flow of medium, thereby creating a well-controlled microenvironment. The general goals of most in vitro systems in drug research are to optimally mimic the in vivo situation, and to minimize the number of animals required for preclinical studies. Moreover, they may contribute to a reduced attrition rate of drugs at a late stage of the drug development process; this is especially true if human tissue or cells are used. A number of factors are important in achieving good in vivo predictability in microfluidic systems, of which the biological system itself (cells or tissue) and the incubation conditions are the most important. The last couple of years have seen various microfluidic-based in vitro systems being developed to incorporate many different cells and/or tissues. In this review, microfluidics-based in vitro systems realized to study liver metabolism and toxicity are summarized and discussed with respect to their applications, advantages, and limitations. The biological basis of these systems is evaluated, and incubation conditions considered. Precise control of the cell or tissue microenvironment is a key advantage of using microfluidic technologies, and the benefits of exposing the cells to medium flow are demonstrated. Special attention is also paid to the incorporation of multiple cell types or tissues into a microfluidic device for the investigation of interorgan interactions, which are difficult if not impossible to study in conventional systems.