Of 34 solitary small hepatocellular carcinomas (HCC) 2 cm in diameter or less, 13 with hyperechoic lesions were observed serially by sonography, and 11 of these were examined histologically. Serial examination showed that hypoechoic areas appeared at the periphery of or within, the hyperechoic tumor, and that these areas expanded more with tumor growth than the hyperechoic areas as if compressing or displacing the existing hyperechoic areas. Histologically, the hyperechoic lesions were composed mostly of well-differentiated cancer cells containing fat droplets, whereas the hypoechoic lesions were composed of cancer cells without fat droplets. In the two tumors that were formed almost completely of cancer cells showing fatty metamorphosis, cancer cells without fat droplets proliferated mainly in the periphery of the tumor. These findings suggest that, in hyperechoic HCC, cancer cells with fat droplets appear in the early stage of HCC, and probably change into concer cells without fat droplets by the time that a certain tumor size is reached, with gradual displacement by the latter type of cell during tumor growth.