Hepatocellular carcinoma (HCC) is the most common hepatic malignancy and the third leading cause of cancer related deaths. Previous studies have implicated bile acids in pathogenesis of HCC but the mechanisms are not known. We investigated the mechanisms of HCC tumor promotion by bile acids the diethylnitrosamine (DEN)- initiation-cholic acid (CA)-induced tumor promotion protocol in mice. The data show that 0.2% CA treatment resulted in 3-fold increase in number and size of DEN-induced liver tumors. All tumors observed in DEN-treated mice were well-differentiated HCCs. The HCCs observed in DEN-treated CA-fed mice exhibited extensive CD3, 20 and 45 positive inflammatory cell aggregates. Microarray based global gene expression studies combined with Ingenuity Pathway Analysis revealed significant activation of NF-B and Nanog in the DEN-treated 0.2% CA-fed livers. Further studies showed significantly higher TNFα and IL-1β mRNA, a marked increase in total and phosphorylated-p65 and phosphorylated IBα (degradation form) in livers of DEN-treated 0.2% CA-fed mice. Treatment of primary mouse hepatocytes with various bile acids showed significant induction of stemness genes including Nanog, KLF4, Sox2 and Oct4. Quantification of total and twenty specific bile acids in liver and serum revealed a tumor associated bile acid signature. Finally, quantification of total serum bile acids in normal, cirrhotic and HCC human samples revealed increased bile acids in serum of cirrhotic and HCC patients. Taken together, these data indicate that bile acids are mechanistically involved pathogenesis of HCC and may promote HCC formation via activation of inflammatory signaling.