Longevity assurance homolog 2 of yeast LAG1 (Lass2) gene is capable of suppressing the proliferation and metastasis of several types of tumours including liver cancer. In the present study, hepatocyte-specific Lass2-knockout (Lass2 KO) and wild-type (WT) mice were exposed to the carcinogen, diethylnitrosamine (DEN), to induced liver tumours. At week 23 following DEN injection, tumours were produced in 100% of the Lass2 KO mice and 21.4% of the WT mice. At week 40, 100% of the Lass2 KO mice and 78.6% of the WT mice developed tumours, with no distinct significant difference in tumour occurrences between the two genotypes; yet, tumours in the Lass2 KO mouse livers were more numerous and larger in size. Hepatocellular carcinoma (HCC) was confirmed by α-fetoprotein (AFP). PCNA and EdU assays indicated more active proliferation whereas TUNEL assay revealed decreased apoptosis in Lass2 KO livers, when compared with the WT control. The expression of plasminogen activator inhibitor type-1 (PAI-1), a tumour-promoting gene, in the liver tissues of the 2 genotypes was detected using qPCR and western blotting, showing that PAI-1 levels were significantly elevated in Lass2 KO livers at week 40 following DEN introduction. Moreover, the expression of PAI-1-related TGF-β1, Smad-4 and -7 was detected, displaying an elevation in TGF-β1 and Smad-4 (not including Smad-7) in the Lass2 KO livers. Our data demonstrates that i) Lass2 is a protective gene against DEN-induced liver tumourigenesis; and ii) upregulation of the TGF-β1-Smad4-PAI-1 axis may contribute to the vulnerability of Lass2-knockout mice to DEN.