In vitro differentiation of stem cells into specific cell lineages provides a stable cell supply for cell therapy and tissue engineering. Therefore, understanding the mechanisms underlying such differentiation processes is critical for generating committed lineage-specific cell progenies effectively. We previously developed a two-step protocol to differentiate mesenchymal stromal cells (MSCs) into hepatocyte-like cells. Since hepatic differentiation involves mesenchymal-epithelial transition (MET), we hypothesize that promoting MET could further accelerate the differentiation process. Ras-related C3 botulinum toxin substrate 1 (Rac1) is involved in actin polymerization and its role in MET was investigated in the study. Our results showed that inhibition of Rac1 activation by Rac1-specific inhibitor, NSC23766, led to cells favoring epithelial morphology and being more packed during hepatic differentiation. In addition, Rac1 inhibition accelerated the upregulation of hepatic marker genes accompanied by more mature hepatic functions. Taken together, promotion of MET by inhibiting Rac1 accelerates the hepatic differentiation of MSCs. Our findings open a new prospect of directing the commitment of MSCs by manipulating cell morphology and cytoskeleton arrangement through small molecules. The results provide further insight into scaffold design for rapid production of MSC-differentiated hepatocytes.