Nuclear factor erythroid 2-related factor 2 (NRF2) is a transcription factor that plays a role in the regulation of redox homeostasis and cellular metabolism. Activating mutations in NRF2 have been identified in a subset of liver cancer patients. However, the mechanisms by which NRF2 promotes liver tumourigenesis are poorly understood. To address this gap in knowledge, we developed a transgenic zebrafish model with hepatocyte-specific, inducible expression of a clinically relevant constitutively active NRF2 mutant (NRF2T80K). Using a combination of single-cell sequencing, lineage tracing, confocal imaging, and functional assays, we have shown that constitutive activation of NRF2 drives hepatocyte to cholangiocyte transdifferentiation. Moreover, we find that NRF2-driven transdifferentiation, in the context of p53 deficiency, contributes to the initiation of cholangiocarcinoma. Importantly, we have demonstrated that NRF2 affects cell plasticity in a cell-autonomous, evolutionarily conserved, and reversible manner. Finally, we have shown that NRF2-driven transdifferentiation is inhibited by FHD-286, a selective inhibitor of the SWI/SNF complex subunit BRG1. Overall, our study reveals a novel role for NRF2 in the regulation of cell plasticity during liver tumourigenesis and identifies FHD-286 as a promising therapy for NRF2-driven liver cancers.