Hepatocyte growth factor (HGF) is a polypeptide with mitogenic, motogenic, and morphogenic effects on different cell types including hepatocytes. HGF is expressed as two biologically active isotypes resulting from alternative RNA splicing. The roles of each HGF isoform in development, liver regeneration and tumorigenesis have not yet been well characterized. We report the generation and analysis of transgenic mice overexpressing the five amino acid-deleted variant of HGF (dHGF) in the liver by virtue of an albumin expression vector. These ALB-dHGF transgenic mice develop normally, have an enhanced rate of liver regeneration after partial hepatectomy, and exhibit a threefold higher incidence of hepatocellular carcinoma (HCC) beyond 17 months of age. Moreover, overexpression of dHGF dramatically accelerates diethyl-nitrosamine induced HCC tumorigenesis. These tumors arise faster, are significantly larger, more numerous and more invasive than those appearing in non-transgenic littermates. Approximately 90% of female dHGF-transgenic mice had multiple macroscopic HCCs 40 weeks after injection of DEN; whereas the non-transgenic counterparts had only microscopic nodules. Liver tumors and cultured tumor cell lines from dHGF transgenics showed high levels of HGF and c-Met mRNA and protein. Together, these results reveal that in vivo dHGF plays an active role in liver regeneration and HCC tumorigenesis.