The four and a half LIM-only protein 2 (FHL2) is upregulated in diverse pathological conditions. Here, we analyzed the effects of FHL2 overexpression in the liver of FHL2 transgenic mice (Apo-FHL2). We first examined cell proliferation and apoptosis in Apo-FHL2 livers and performed partial hepatectomy to investigate high FHL2 expression in liver regeneration. Expression of FHL2 was then analyzed by real time PCR in human hepatocellular carcinoma and adjacent non-tumorous livers. Finally, the role of FHL2 in hepatocarcinogenesis was assessed using Apo-FHL2;Apc(lox/lox) mice. Six-fold increase in cell proliferation in transgenic livers was associated with concomitant apoptosis, resulting in normal liver mass. In Apo-FHL2 livers, both cyclin D1 and p53 were markedly increased. Evidence supporting a p53-dependent cell death mechanism was provided by the findings that FHL2 bound to and activated the p53 promoter, and that a dominant negative p53 mutant compromised FHL2-induced apoptosis in hepatic cells. Following partial hepatectomy in Apo-FHL2 mice, hepatocytes displayed advanced G1 phase entry and DNA synthesis leading to accelerated liver weight restoration. Interestingly, FHL2 upregulation in human liver specimens showed significant association with increasing inflammation score and cirrhosis. Finally, while Apo-FHL2 mice developed no tumors, the FHL2 transgene enhanced hepatocarcinogenesis induced by liver-specific deletion of the adenomatous polyposis coli gene and aberrant Wnt/β-catenin signaling in Apc(lox/lox) animals. Our results implicate FHL2 in the regulation of signaling pathways that couple proliferation and cell death machineries, and underscore the important role of FHL2 in liver homeostasis and carcinogenesis.