Genes associated with retinoid‐interferon‐induced mortality 19 (GRIM‐19) was identified as a tumor suppressor protein associated with apoptosis and growth inhibition. Here, we report that the expression levels of GRIM‐19 are significantly attenuated in hepatocellular carcinoma (HCC) patients with deteriorating differentiation states, hepatic capsule invasion and microvascular invasion, suggesting the potential role of GRIM‐19 not only at the origin but also in the invasive progression of HCCs. To dissect the possible mechanisms by which GRIM‐19 regulates tumor cell invasion, we established the hepatic HL‐7702 and HCC Huh‐7 cell lines stably depleted of GRIM‐19. Results show that downregulation of GRIM‐19 induces a morphological transformation resembling epithelial–mesenchymal transition (EMT) as well as aberrant expression of epithelial and mesenchymal molecular markers. Additionally, these cells lose contact inhibition, a phenomenon of cessation of cell migration in contact with neighboring cells, as assessed by cell imaging, growth curve and S‐phase transition in confluent conditions. Conclusion: Our observations demonstrate a novel mechanistic insight into a critical role of GRIM‐19 in HCC invasive potential. J. Cell. Physiol. 227: 1212–1219, 2012. © 2011 Wiley Periodicals, Inc.