Huaier can effectively inhibit the growth of tumor cells by enhancing the immune system. However, the mechanism of its function is still not clear. The current study aimed to explore the possible mechanism of Huaier in inhibiting human hepatocarcinoma cells by observing its effect on proliferation and invasion in hepatocarcinoma cells, HepG2 and HepG2-X, which stably express the HBx gene, and by comparing the levels of mRNA transcription and protein expression of HBx and CEACAM1 in HepG2 cells and HepG2-X cells when treated with different concentrations of Huaier. HepG2 cells and HepG2-X cells were treated with 0, 1.5, 3.0, and 6.0 g/L-1 Huaier extract in vitro. MTT assay was used to measure the inhibition of cell proliferation. The transwell cell model coated with Matrigel glue was used to detect the invasion of HepG2 and HepG2-X cells in vitro. Flowcytometry was used to observe changes in cell cycle. Real-time PCR and Western blot were used to detect HBx and CEREAM1 mRNA transcription and protein expression separately. Huaier extract can inhibit HepG2 and HepG2-X cell proliferation in a time- and dose-dependent manner. The A value of HepG2-X cells in each group was higher than that of HepG2 cells. Compared with the control group, the invasion ability of HepG2 and HepG2-X cells decreased significantly after treatment with Huaier extract, in a dose-dependent manner. The cell cycle of HepG2 and HepG2-X was arrested at S phase. The distribution of G0/G1 phase decreased gradually with the increase of the concentration of Huaier extract, and the proportion of G0/G1 phase distribution declined. After treating with Huaier extract, mRNA transcription and protein expression of HBx in HepG2 and HepG2-X declined, while those of CEACAM1 increased, reflecting a dose-dependent manner (P less than 0.05). Therefore, we concluded that the inhibitory effect of Huaier extract on hepatocarcinoma cell proliferation might function through down regulation of HBx gene expression and upregulation of CEACAM1 gene expression.