Farnesoid X receptor (FXR) belongs to the nuclear receptor superfamily with its endogenous ligands bile acids. Mice with whole body FXR deficiency develop liver tumors spontaneously, but the underlying mechanism is unclear. Moreover, it is unknown whether FXR deficiency in liver alone serves as a tumor initiator or promoter during liver carcinogenesis. This study aims to evaluate the effects of hepatocyte-specific FXR deficiency (FXRhep-/-) in liver tumor formation. The results showed that FXRhep-/- mice did not show spontaneous liver tumorigenesis with aging (up to 24 mo of age). Therefore FXRhep-/- mice were fed a bile acid (cholic acid)-containing diet alone or along with a liver tumor initiator, diethylnitrosamine (DEN). Thirty weeks later, no tumors were found in wild-type or FXRhep-/- mice without any treatment or with DEN only. However, with cholic acid, while only some wildtype mice developed tumors, all FXRhep-/- mice presented with severe liver injury and tumors. Interestingly, FXRhep-/- mouse livers increased basal expression of tumor suppressor p53 protein, apoptosis, and decreased basal cyclin D1 expression, which may prevent tumor development in FXRhep-/- mice. However, cholic acid feeding reversed these effects in FXRhep-/- mice, which is associated with an increased cyclin D1 and decreased cell cycle inhibitors. More in-depth analysis indicates that the increased in cell growth might result from disturbance of the MAPK and JAK/Stat3 signaling pathways. In conclusion, this study shows that hepatic FXR deficiency may only serve as a tumor initiator, and increased bile acids is required for tumor formation likely by promoting cell proliferation.