SAP-1 (stomach cancer-associated protein tyrosine phosphatase-1) is a transmembrane-type protein tyrosine phosphatase that has been implicated as a negative regulator of integrin-mediated signaling. The potential role of this enzyme in hepatocarcinogenesis has now been investigated by examining its expression in 32 surgically excised human hepatocellular carcinoma (HCC) specimens. Both immunohistochemical and immunoblot analyses revealed that normal liver tissue, as well as tissue affected by chronic hepatitis or cirrhosis, contained substantial amounts of SAP-1. The expression level of SAP-1 in 75% of well-differentiated HCCs was similar to or higher than that observed in the surrounding noncancerous tissue. In contrast, the abundance of SAP-1 in 85.7% of moderately differentiated HCCs and in all poorly differentiated HCCs was greatly reduced compared with that in the adjacent tissue. Indeed, SAP-1 was almost undetectable in 83.3% of poorly differentiated HCCs. Furthermore, expression of recombinant SAP-1 in two highly motile human HCC cell lines resulted in a change in morphology and a marked reduction in both migratory activity and growth rate. In conclusion, these results indicate that SAP-1 expression is downregulated during the dedifferentiation of human HCC, and that this downregulation may play a causal role in disease progression.