Beta-catenin integrates intracellular WNT signalling and the intercellular E-cadherin–catenin adhesion system. To date, little is known about the role of β-catenin activation and nuclear accumulation in hepatocarcinogenesis. This study has analysed β-catenin expression patterns in human dysplastic nodules (DNs), as well as in hepatocellular carcinomas (HCCs) in comparison with proliferation, expression of WNT-1 target genes, E-cadherin, and p53. One hundred and seventy HCCs and 25 DNs were categorized according to established criteria and analysed for the expression pattern of β-catenin. Analysis of the proliferative activity and expression of E-cadherin, cyclin D1, MMP-7, c-myc, and p53 was performed on a representative subgroup of cases. All DNs lacked nuclear β-catenin, while 36% of all HCCs were positive, with the number of nuclear stained cells ranging from less than 1% to more than 90%. Increasing nuclear accumulation of β-catenin correlated with reduced membranous E-cadherin expression and nuclear p53 but not with proliferation. Cyclin D1, MMP-7, and c-myc expression was detected in 54%, 26%, and 65% of HCCs, respectively, but did not correlate with nuclear β-catenin, proliferation, or grading. Sequence analysis of the β-catenin gene revealed no detectable mutations in DNs, but mutations in the GSK-3β binding site were present in 14.3% of the HCCs. In conclusion, this study has demonstrated that nuclear accumulation of β-catenin is a frequent progression event in human hepatocarcinogenesis which correlates with nuclear p53 accumulation and loss of membranous E-cadherin, but not with the expression pattern of established WNT-1 target genes. It is hypothesized that the role of β-catenin in human HCC differs significantly from its established function in colon carcinogenesis. Copyright © 2003 John Wiley & Sons, Ltd.