It is well accepted that HBx plays the major role in hepatocarcinogenesis associated with hepatitis B virus (HBV) infections. However, little was known about its role in regulating long noncoding RNAs (lncRNAs), a large group of transcripts regulating a variety of biological processes including carcinogenesis in mammalian cells. Here we report that HBx upregulates UCA1 genes and downregulates p27 genes in hepatic LO2 cells. Further studies show that the upregulated UCA1 promotes cell growth by facilitating G1/S transition through CDK2 in both hepatic and hepatoma cells. Knock down of UCA1 in HBx-expressing hepatic and hepatoma cells resulted in markedly increased apoptotic cells by elevating the cleaved caspase-3 and caspase-8. More importantly, UCA1 is found to be physically associated with enhancer of zeste homolog 2 (EZH2), which suppresses p27Kip1 through histone methylation (H3K27me3) on p27Kip1 promoter. We also show that knockdown of UCA1 in hepatoma cells inhibits tumorigenesis in nude mice. In a clinic study, UCA1 is found to be frequently up-regulated in HBx positive group tissues in comparison with the HBx negative group, and exhibits an inverse correlation between UCA1 and p27Kip1 levels. Our findings demonstrate an important mechanism of hepatocarcinogenesis through the signaling of HBx-UCA1/EZH2-p27Kip1 axis, and a potential target of HCC.