We introduce the microfluidic organoids for drug screening (MODS) platform, a digital microfluidic system that is capable of generating arrays of individually addressable, free-floating, three-dimensional hydrogel-based microtissues (or 'organoids'). Here, we focused on liver organoids, driven by the need for early-stage screening methods for hepatotoxicity that enable a "fail early, fail cheaply" strategy in drug discovery. We demonstrate that arrays of hepatic organoids can be formed from co-cultures of HepG2 and NIH-3T3 cells embedded in hydrogel matrices. The organoids exhibit fibroblast-dependent contractile behaviour, and their albumin secretion profiles and cytochrome P450 3A4 activities are better mimics of in vivo liver tissue than comparable two-dimensional cell culture systems. As proof of principle for screening, MODS was used to generate and analyze the effects of a dilution series of acetaminophen on apoptosis and necrosis. With further development, we propose that the MODS platform may be a cost-effective tool in a "fail early, fail cheaply" paradigm of drug development.