Hepatocellular carcinoma (HCC) in the caudate lobe is rare and the prognosis of patients with HCC in the caudate lobe has been reported to be poor. Resection for HCC in the caudate lobe has carried a higher rate of surgical risk and early recurrence. The effect of transcatheter arterial embolization (TAE) in treating HCC in the caudate lobe remains unknown. With the wide application of modern diagnostic modalities, we can now detect HCC at an earlier stage for active treatment (surgery or TAE). The aim of the present study was to analyse the effect of different treatments for HCC in the caudate lobe. From 1985 to 1994, 15 patients with HCC in the caudate lobe were retrospectively studied. Another 264 consecutive patients with newly diagnosed HCC treated by TAE were selected as the control group. Two patients underwent surgical resection and survived well without recurrence after 43 and 136 months, respectively. Ten patients underwent TAE and their survival rate was similar to that of the 264 consecutively TAE-treated controls with HCC not in the caudate lobe (P = 0.19). The 1, 3 and 5 year survival rates for TAE-treated patients in the caudate lobe were 67.7, 31.1 and 12.6%, respectively, while in controls these figures were 53.0, 18.4 and 9.1%, respectively. Two of the three patients receiving supportive treatment died within 1 month after diagnosis. Those patients having a smaller solitary tumour without intrahepatic metastasis tended to survive longer. In conclusion, HCC in the caudate lobe does not always indicate a poor prognosis so long as early detection and active treatment (surgery or TAE) are available. Transcatheter arterial embolization may act as an alternative treatment modality for patients with HCC in the caudate lobe.