Fibroblast growth factor receptor 2 isoform b (FGFR2-IIIb) is highly expressed in hepatocytes and plays an important role in liver homeostasis and regeneration. Here, we analyzed the expression and function of FGFR2-IIIb in hepatocellular carcinoma (HCC). FGFR2-IIIb expression in HCC tissues and cell lines was lower than in primary human hepatocytes and nontumorous tissue. FGFR2-IIIb-negative HCCs showed a significantly higher Ki-67 labeling index, and loss of FGFR2-IIIb expression correlated significantly with vascular invasion and more advanced tumor stages. A decrease in FGFR-2IIIb expression in HCC cell lines was not related to promoter hypermethylation. However, PCR analysis indicated that chromosomal deletion at 10q accounted for the loss of FGFR2 expression in a subset of HCC cells. FGFR2-IIIb re-expression in stable transfected HCC cell lines induced a higher basal apoptosis rate and a significantly reduced proliferation and migratory potential in vitro. In nude mice, FGFR2-IIIb re-expressing HCC cells grew significantly slower, and terminal deoxynucleotidyl transferase-mediated dUTP nick-end labeling assay revealed higher apoptosis rates. The antitumorigenic effects of FGFR2-IIIb expression in HCC cells were not affected by keratinocyte growth factor or an inhibitor of FGFR-phosphorylation, indicating that they are independent of tyrosine kinase activation. In conclusion, our data indicate that FGFR2-IIIb inhibits tumorigenicity of HCC cells. Identification of the molecular mechanisms promoting regeneration in normal tissue while suppressing malignancy may lead to novel therapeutic targets of this highly aggressive tumor.