This study was aimed at evaluating the efficacy of chemoembolization (CE) to improve survival in patients with hepatocellular carcinoma (HCC). Our results were compared with the natural history of HCC. Sixty-two consecutive patients with HCC in Okuda's stages I and II underwent CE. Forty-seven patients were treated with CE alone; 9 patients had CE prior to surgery, and 6 patients had it after surgery because of recurrent HCC. One hundred and nine CEs (mean: 1.8 CEs/patient) were performed with Lipiodol UF, epirubicin and gelatin sponge. Actuarial survival was calculated considering Okuda's stage, neoplasm size, and evidence of pseudocapsule. The mean cumulative survival of the 47 patients treated with CE alone was 13.2 months; survival (+/- SE) at 12, 24 and 36 months was 0.75 (+/- 0.07), 0.46 (+/- 0.10) and 0.28 (+/- 0.12). Survival was not affected by Okuda's stage, neoplasm size, evidence of pseudocapsule (p > 0.05). Nevertheless, the patients with early HCC had better prognosis. Eighteen patients (42.9%) died during follow-up, 12 of whom (66.7%) from hepatic failure. The mean survival of patients with recurrence of HCC after surgery was 41 months (range: 24.8-74.9 months) since initial diagnosis of HCC, and 14.8 months (range: 7.1-29.6 months) since diagnosis of recurrence. Two of these patients died from hepatic failure. All the patients who underwent also surgery after CE are still alive (mean survival: 14.7 months). Histologic findings of resected specimens revealed viable neoplastic cells in all cases. Twenty-one major complications (20.2%) occurred in 18 patients (29%); the outcome of complications was favorable in all but one patient who died from sepsis. CE is a reliable and safe treatment for unresectable HCC. Small HCCs should be preferably treated with surgery or, alternatively, with percutaneous alcohol injection.