The hepatotoxicity of cocaine in the mouse is associated with a significant amount (greater than 2 nmol/mg) of irreversible binding of a cocaine metabolite to hepatic protein. The drug-induced hepatic necrosis correlated with the degree of radiolabeled cocaine binding to hepatic protein and both were shown to be dependent on species high doses of the drug (30-65 mg/kg) and selective channeling of cocaine metabolism by either microsomal induction or esterase inhibition. Subcellular fractionation of hepatic tissue showed that greater than 66% of irreversible binding occurred in the microsomal fraction of the liver. Little (less than 0.2 nmol/mg of protein) binding was observed in other tissue protein of the mouse. Increased binding of radiolabeled material to hepatic protein in phenobarbital-pretreated mice was observed with 3H-benzoyl and 14C-methoxy but not with [3H3-C-N]cocaine. It is proposed that cocaine is metabolized by microsomal enzymes to a chemically reactive intermediate that binds to hepatic tissue protein to produce liver damage. The metabolic formation and subsequent hepatic toxicity of the reactive cocaine metabolite is species-dependent and is associated with binding of the intact norcocaine structure to tissue protein. Pretreatments which enhance hepatic microsomal metabolism or inhibit tissue esterase activity increase the amount of protein bound material and lead to production of cocaine hepatotoxicity.