Natural killer (NK) cells are important effector cells for the first line of defense against tumor, but the mechanisms by which they recognize and kill human hepatocellular carcinoma (HCC) remains to be elucidated. Distant MHC class I homologs MICA and MICB are recently identified human ligands for NK cell activating receptor NKG2D. In our present study, MICA or MICB transcript was detected in 6 of 10 human hepatocellular carcinoma tissues, but not in the surrounding non‐cancerous tissues. Immunohistochemical analysis showed that MICA/B were expressed in the tumor cells of the cancerous tissues. Huh7 and HepG2 hepatoma cells, but not Hep3B cells, substantially expressed MICA/B on their cell surface. MICA/B expressed on hepatoma cells contributed to their NK sensitivity, because Huh7 and HepG2 were less susceptible to NK cytolysis when MAb against MICA/B was added during the cytolysis assay. Of interest is the finding that retinoic acid upregulated expression of MICA/B in Huh7 and HepG2 cells. Retinoic acid‐treated hepatoma cells induced IFNγ production from cocultured NK cells and rendered themselves more susceptible to NK cells. This was clearly dependent on upregulation of MICA/B, because both the enhanced IFNγ production and NK cytolysis were completely abolished by MAb‐mediated masking of MICA/B. These results suggest that MICA/B, expressed on a subset of human HCCs, may play an important role in their susceptibility to NK cells. Furthermore, retinoic acid can function as a modulator of MICA/B expression and thereby further activate NK cells. © 2003 Wiley‐Liss, Inc.