Summary. Chronic hepatitis B (CHB) virus hepatitis B virus (HBV) infection is the key cause of hepatocellular carcinoma (HCC) in Asians. Recent studies have shown that levels of CD4+CD25+ regulatory T cells (Tregs) were increased and were linked to an impaired immune response in patients with CHB. Evaluating whether Tregs are involved in the progression of CHB to HCC will provide insight into the immunopathogenesis of HCC. In the present study, we showed that circulating and liver-residing Tregs increased in CHB (n = 15) and HCC (n = 49) patients, particularly in the peripheral blood of HCC patients with HBV infection (n = 29). The increased Tregs in CHB patients suppressed the specific immune response induced by not only HBV antigen, but also by HCC tumour antigen. When peripheral blood mononuclear cells (PBMC) were co-cultured with human hepatoma cell lines that are stably transfected with HBV (HepG2.2.15), CD4+CD25+ Treg populations increased and upregulated the expression of forkhead box P3 transcriptional regulator (FoxP3), cytotoxic T lymphocyte-associated antigen-4 (CTLA-4) and glucocorticoid-induced tumour necrosis factor (TNF) receptor family gene (GITR). In contrast, PBMCs co-cultured with HepG2 cells (the parental cell line of HepG2.2.15) did not. CD4+CD25+ Tregs isolated from PBMCs that were co-cultured with HepG2.2.15 cells also had a greater suppressive ability with respect to the tumour antigen-specific immune response induced by NY-ESO-1 or MAGE-A3 compared with CD4+CD25+ Tregs isolated from PBMCs co-cultured with HepG2 cells. The results offer evidence that the expansion of CD4+CD25+ Tregs and the enhancement of the suppressor function of CD4+CD25+ Tregs induced by HBV infection-related factors could suppress the anti-tumour immune response to HCC tumour antigen and inhibit tumour immuno-surveillance against HCC, which may be involved in the immunopathogenesis from CHB to HCC.