Porcine hepatocytes transplanted during acute liver failure might support metabolic functions until the diseased liver recovers its function. Here, we isolated high numbers of viable pig hepatocytes and evaluated hepatocyte functionality after encapsulation. We further investigated whether co-culture and co-encapsulation of hepatocytes with human multipotent mesenchymal stromal cells (MSC) is beneficial on hepatocyte function. Livers from 10kg pigs (n=9) were harvested and hepatocytes were isolated from liver suspensions for microencapsulation using alginate and poly(ethylene-glycol)(PEG)-grafted alginate polymeric hydrogels, either alone or in combination with MSC. Viability, albumin secretion and diazepam catabolism of hepatocytes were measured for one week. 9.2±3.6x109 hepatocytes with 95.2±3.1% viability were obtained after isolation. At day 3, free hepatocytes displayed 99% viability, whereas microencapsulation in alginate and PEG-grafted alginate decreased viability to 62% and 48%, respectively. Albumin secretion and diazepam catabolism occurred in free and microencapsulated hepatocytes. Co-encapsulation of hepatocytes with MSC significantly improved viability and albumin secretion at days 4 and 8 (p<0.05). Co-culture with MSC significantly increased and prolonged albumin secretion. In conclusion, we established a protocol for isolation and microencapsulation of high numbers of viable pig hepatocytes and demonstrated that the presence of MSC are beneficial for viability and function of porcine hepatocytes.