Abstract Background Many drugs have the potential to induce the expression of drug-metabolizing enzymes, particularly cytochrome P450 3A4 (CYP3A4), in hepatocytes. Hepatocytes can be accurately evaluated for drug-mediated CYP3A4 induction; this is the gold standard for in vitro hepatic toxicology testing. However, the variation from lot to lot is an issue that needs to be addressed. Only a limited number of immortalized hepatocyte cell lines have been reported. In this study, immortalized cells expressing CYP3A4 were generated from a patient with drug-induced liver injury (DILI). Methods To generate DILI-derived cells with high expression of CYP3A4, a three-step approach was employed: (1) Differentiation of DILI-induced pluripotent stem cells (DILI-iPSCs); (2) Immortalization of the differentiated cells; (3) Selection of the cells by puromycin. It was hypothesized that cells with high cytochrome P450 gene expression would be able to survive exposure to cytotoxic antibiotics because of their increased drug-metabolizing activity. Puromycin, a cytotoxic antibiotic, was used in this study because of its rapid cytocidal effect at low concentrations. Results The hepatocyte-like cells differentiated from DILI-iPSCs were purified by exposure to puromycin. The puromycin-selected cells (HepaSM or SI cells) constitutively expressed the CYP3A4 gene at extremely high levels and exhibited hepatocytic features over time. However, unlike primary hepatocytes, the established cells did not produce bile or accumulate glycogen. Conclusions iPSC-derived hepatocyte-like cells with intrinsic drug-metabolizing enzymes can be purified from non-hepatocytes and undifferentiated iPSCs using the cytocidal antibiotic puromycin. The puromycin-selected hepatocyte-like cells exhibited characteristics of hepatocytes after immortalization and may serve as another useful source for in vitro hepatotoxicity testing of low molecular weight drugs.