Upon extensive hepatocyte loss or impaired hepatocyte proliferation, liver regeneration occurs via biliary epithelial cell (BEC) transdifferentiation, which includes dedifferentiation of BECs into bipotential progenitor cells (BP-PCs) and then redifferentiation of BP-PCs to nascent hepatocytes and BECs. This BEC-driven liver regeneration involves reactivation of hepatoblast markers, but the underpinning mechanisms and their effects on liver regeneration remain largely unknown. Using a zebrafish extensive hepatocyte ablation model, we perform an N-ethyl-N-nitrosourea (ENU) forward genetic screen and identify a liver regeneration mutant, liver logan (lvl), in which the telomere maintenance 2 (tel2) gene is mutated. During liver regeneration, the tel2 mutation specifically inhibits transcriptional activation of a hepatoblast marker, hematopoietically expressed homeobox (hhex), in BEC-derived cells, which blocks BP-PC redifferentiation. Mechanistic studies show that Tel2 associates with the hhex promoter region and promotes hhex transcription. Our results reveal roles of Tel2 in the BP-PC redifferentiation process of liver regeneration by activating hhex.