An upregulated expression of hepatocyte growth factor activator inhibitor type 1 (HAI-1) in hepatocellular carcinomas (HCC) associates with poor prognosis, but the underlying mechanism for expression regulation has not been elucidated. HAI-1 was expressed in HCC cell line Hep3B cells at a high level but absent or has a low level in other HCC cell lines HepG2 and SMMC7721 and immortal normal liver cell line L02 at transcriptional and translational levels, respectively. A dual-luciferase reporter assay showed that transcriptional activity of HAI-1 in the promoter region (-452 bp to -280 bp from the mRNA start site) was strongly enhanced in Hep3B and SMMC7721. Bisulfite genomic sequencing results of the HAI-1 promoter region showed an inverse correlation between levels of promoter methylation and expression in HCC cells. The expression level of HAI-1 in SMMC7721, HepG2, and L02 cells was elevated after 5-Aza-2'-deoxycytidine treatment. Hypomethylation of the HAI-1 promoter region contributed to the elevated HAI-1 expression in HCC tissues. In addition, the hypomethylation of the HAI-1 promoter region correlated with poor differentiation status of HCC tissues. Our findings indicate that promoter hypomethylation is an important mechanism for aberrant HAI-1 expression regulation in HCC.