Induction of autophagy usually acts as a survival mechanism of cancer cells in response to chemotherapy. However, the function and molecular mechanism of autophagy in human hepatoma cells under drug treatment is still not clear. To address this issue, we established an experimental model in which HepG2 cells were treated with etoposide, a widely used anticancer agent. We demonstrate the etoposide-induced accumulation of GFP-LC3 dots by fluorescent microscopy, the up-regulation of LC3-II protein expression by Western blotting and the increased number of autophagic vacuoles by electron microscopy, confirming the activation of autophagy by etoposide in HepG2 cells. Inhibition of autophagy by either 3-methyladenine (3MA) or beclin-1 small interfering RNA enhanced etoposide-induced cell death. Furthermore, activation of p53 and AMPK was detected in etoposide-treated cells and inhibition of AMPK triggered apoptosis through suppression of autophagy. On the other hand, inactivation of p53 promoted cell survival through augmentation of autophagy. Collectively, these findings indicate that etoposide-induced autophagy promotes hepatoma cell adaptation and survival, and that autophagy inhibition improves the chemotherapeutic effect of etoposide. Moreover, AMPK activation is clearly associated with etoposide-induced autophagy. We conclude that manipulation of AMPK may be a promising approach of adjuvant chemotherapy for hepatocellular carcinoma.