Transarterial chemoembolization represents a first-line non-curative therapy for hepatocellular carcinoma (HCC), although the biological changes in the remaining cancer after embolization are not completely understood. In the present study, we examined whether transarterial embolization (TAE) enhances the metastatic potential of residual HCC and investigated the mechanisms underlying embolization. The hepatoma cell line McA-RH7777, which is marked by green fluorescent protein (GFP), was used in the study. The invasion of cells cultured under hypoxia and normoxia was observed using the Transwell assay. Twenty male buffalo rats were implanted with GFP transfected McA-RH7777 tumors in the left lateral lobe of the liver. After laparotomy and retrograde placement of a catheter into the gastroduodenal artery (on the 14th day after implantation), TAE using lipiodol (0.2 ml/kg) was performed. Tumor volumes were measured before and after treatment using magnetic resonance imaging (MRI). Lung metastases were observed using fluorescence imaging, and the molecular changes of residual tumor cells were evaluated by western blotting or immunohistochemistry. The invasion assays indicated that the number of invading hypoxic cells was significantly higher than that of normoxic cells (30.2 ± 2.46 vs. 20.4 ± 1.89, P=0.013). Accompanying an increase in hypoxia-inducible factor-1α (HIF-1α) expression, the metastatic potential of tumor cells following hypoxia or TAE was enhanced. This enhanced metastatic potential was indicated by a significant reduction in the expression of E-cadherin and an upregulation of N-cadherin and vimentin expression. The number of lung metastases in the TAE group was 19.20 ± 1.76, whereas this number was 11.30 ± 1.54 in the control group, which represented a statistically significant difference (P=0.003). In conclusion, hypoxia in the residual tumor after TAE can increase the invasiveness and metastatic potential of HCC and may be responsible for the failure of TAE.