Hepatocyte damage during liver injury instigates activation of macrophages and hepatic stellate cells (HSCs) resulting in liver inflammation and fibrosis respectively. Improving hepatocyte survival and proliferation thereby ameliorating inflammation and fibrosis represents a promising approach for the treatment of liver injury. In the liver, fibroblast growth factors (FGFs) play a crucial role in promoting hepatocyte proliferation and tissue regeneration. Among 22 FGFs, FGF7 induces hepatocyte survival and liver regeneration as shown previously in mouse models of cholestatic liver injury and partial hepatectomy. We hypothesized that FGF7 promotes hepatocyte survival and proliferation by interacting with FGFR2b, expressed on hepatocytes, and ameliorates liver injury (inflammation and early fibrogenesis) via paracrine mechanisms. To prove this hypothesis and to study the effect of FGF7 on hepatocytes and liver injury, we administered FGF7 exogenously to mice with acute carbon tetrachloride (CCl)-induced liver injury. We thereafter studied the underlying mechanisms and the effect of exogenous FGF7 on hepatocyte survival and proliferation, and the consequent paracrine effects on macrophage-induced inflammation, and HSCs activation in vitro and in vivo. We observed that the expression of FGF7 as well as FGFR2 is upregulated during acute liver injury. Co-immunostaining of FGF7 and collagen-I confirmed that FGF7 is expressed by HSCs and is possibly captured by the secreted ECM. Immunohistochemical analysis of liver sections showed increased hepatocyte proliferation upon exogenous FGF7 treatment as determined by Ki67 expression. Mechanistically, exogenous FGF7 improved hepatocyte survival (and increased drug detoxification) via AKT and ERK pathways while maintaining hepatocyte quiescence restricting hepatocarcinogenesis via P27 pathways. Flow cytometry analysis revealed that improved hepatocyte survival and proliferation leads to a decrease in infiltrated monocytes-derived macrophages, as a result of reduced CCL2 (and CXCL8) expression by hepatocytes. Moreover, conditioned medium studies showed reduced collagen-I secretion by HSCs (indicative of HSCs activation) upon treatment with FGF7-treated hepatocytes conditioned medium. Altogether, we show that exogenous administration of FGF7 induces hepatocyte survival and proliferation and leads to amelioration of inflammatory response and fibrosis in acute liver injury via paracrine mechanisms. Our study further demonstrates that FGF7, FGF7 derivatives, or nano-engineered FGF7 may benefit patients with hepatic dysfunction.