Alcohol consumption has long been a global problem affecting human health, and has been found to influence both fetal and adult liver functions. However, how alcohol affects human liver development and liver progenitor cells remains largely unknown. Here, we used human induced pluripotent stem cells (iPSCs) as a model to examine the effects of alcohol, on multi-stage hepatic cells including hepatic progenitors, early and mature hepatocyte-like cells derived from human iPSCs. While alcohol has little effect on endoderm development from iPSCs, it reduces formation of hepatic progenitor cells during early hepatic specification. The proliferative activities of early and mature hepatocyte-like cells are significantly decreased after alcohol exposure. Importantly, at a mature stage of hepatocyte-like cells, alcohol treatment increases two liver progenitor subsets, causes oxidative mitochondrial injury and results in liver disease phenotypes (i.e., steatosis and hepatocellular carcinoma associated markers) in a dose dependent manner. Some of the phenotypes were significantly improved by antioxidant treatment. This report suggests that fetal alcohol exposure may impair generation of hepatic progenitors at early stage of hepatic specification and decrease proliferation of fetal hepatocytes; meanwhile alcohol injury in post-natal or mature stage human liver may contribute to disease phenotypes. This human iPSC model of alcohol-induced liver injury can be highly valuable for investigating alcoholic injury in the fetus as well as understanding the pathogenesis and ultimately developing effective treatment for alcoholic liver disease in adults.