Suppressor of cytokine signaling 1 (SOCS1) is considered as a tumor suppressor protein in hepatocellular carcinoma (HCC), but the underlying mechanisms remain unclear. Previously, we have shown that SOCS1-deficient hepatocytes displayed increased responsiveness to hepatocyte growth factor (HGF) due to enhanced signaling via the MET receptor tyrosine kinase. As aberrant MET activation occurs in many tumors including HCC, here we elucidated the mechanisms of SOCS1-mediated regulation. SOCS1 attenuated HGF-induced proliferation of human and mouse HCC cell lines and their growth as tumors in NOD.scid.gamma mice. Tumors formed by SOCS1 expressing HCC cells showed significantly reduced MET expression, indicating that SOCS1 not only attenuates MET signaling but also regulates MET expression. Mechanistically, SOCS1 interacted with MET via the Src homology 2 domain and this interaction was promoted by MET tyrosine kinase activity. The SOCS1-mediated reduction in MET expression does not require the juxtamembrane Y1003 residue implicated in Cbl-mediated downmodulation. Moreover, the proteasome inhibitor MG-132, but not the inhibitors of lysosomal degradation bafilomycin and chloroquine, reversed the SOCS1-mediated reduction in MET expression, indicating that this process is distinct from Cbl-mediated downmodulation. Accordingly, SOCS1 promoted polyubiquitination of MET via K48-dependent but not K63-mediated ubiquitin chain elongation. Furthermore, siRNA-mediated downmodulation of Cbl did not abolish SOCS1-mediated reduction in MET expression in HCC cells. SOCS1-dependent ubiquitination of endogenous MET receptor occurred rapidly following HGF stimulation in HCC cells, leading to proteasomal degradation of phosphorylated MET receptor. These findings indicate that SOCS1 mediates its tumor suppressor functions, at least partly, by binding to MET and interfering with downstream signaling pathways as well as by promoting the turnover of the activated MET receptor. We propose that loss of this control mechanism due to epigenetic repression of SOCS1 could contribute to oncogenic MET signaling in HCC and other cancers, and that MET inhibitors might be useful in treating these patients.