Histone deacetylases (HDACs) play a critical role in the proliferation, differentiation, and apoptosis of cancer cells. An obstacle for the application of HDAC inhibitors as effective anti-cancer therapeutics is that our current knowledge on the contributions of different HDACs in various cancer types remains scarce. The present study reported that the mRNA and protein levels of HDAC5 were up-regulated in human hepatocellular carcinoma (HCC) tissues and cells as shown by quantitative real-time PCR and Western blot. MTT assay and BrdU incorporation assay showed that the down-regulation of HDAC5 inhibited cell proliferation in HepG2, Hep3B, and Huh7 cell lines. Data from in vivo xenograft tumorigenesis model also demonstrated the anti-proliferative effect of HDAC5 depletion on tumor cell growth. Furthermore, the suppression of HDAC5 promoted cell apoptosis and induced G1-phase cell cycle arrest in HCC cells. On the molecular level, we observed altered expression of apoptosis-related proteins such as p53, bax, bcl-2, cyto C, and caspase 3 in HDAC5-shRNA-transfected cells. Knockdown of HDAC5 led to a significant up-regulation of p21 and down-regulation of cyclin D1 and CDK2/4/6. We also found that the down-regulation of HDAC5 substantially increased p53 stability and promoted its nuclear localization and transcriptional activity. Our study suggested that knockdown of HDAC5 could inhibit cancer cell proliferation by the induction of cell cycle arrest and apoptosis; thus, suppression of HDAC5 may be a viable option for treating HCC patients.