The effects of synthesized 7-OH-4-CH3-coumarin on proliferation and differentiation of human hepatoma carcinoma cell line, SMMC-7721, were examined. Results showed that 7-OH-4-CH3-coumarin suppressed the proliferation of the SMMC-7721 cells in a dose-dependent manner, with an IC50 value of 356±1.8 mM, while concentrations ≥ 200 mM could trigger differentiation. After treatment with this compound at 100 mM, the growth curve of human hepatoma cells decreased markedly. When treated with 50 and 100 mM, the cells' electrophoresis rate decreased from 2.2 mm/s/V/cm in the control group to 1.5 and 1.8 mm/s/V/cm, respectively, and the α-fetoprotein content decreased from 123 ng/mg in the control group to 68 and 45 ng/mg, respectively. The microvilli on the surface of treated cells were also reduced. All the above indexes related to cell malignancy were alleviated significantly. Results showed that 7-OH-4-CH3-coumarin could reverse human hepatoma cells' malignant phenotypic characteristics and induce redifferentiation.