The parenchyma of the liver and pancreas is derived from the endoderm, whereas the stroma is derived from the mesoderm. Both of them are derived from the endoderm of the foregut as the esophagus, stomach, and a part of duodenum. At the 3rd-4th of development, the liver, gallbladder and bile ducts become diverticulum hepaticum that is derived from the caudal portion of the foregut. There were inductive effects of septum transversum and cardiac mesoderm for the development of liver diverticulum. The pancreas arise from the endoderm of the foregut. The pancreas is derived from the fusion of the ventral and dorsal pancreas bulbs, which arise from the endoderm of the duodenum. The inductive effects of the notochord and dorsal aorta play a role in the development of the pancreas. In this manuscript, we attempted to review the morphological and functional development of the liver and pancreas with the aid of pictures obtained from various stages of prenatal and postnatal development in the organs of rats.