C-terminal-truncated hepatitis B virus (HBV) X (HBx) (ctHBX) is frequently detected in hepatocellular carcinoma (HCC) through HBV integration into the host genome. However, the molecular mechanisms underlying ctHBx-associated oncogenic signaling have not yet been clarified. To elucidate the biological role of ctHBx in hepato-oncogenesis, we functionally analyzed ctHBx-mediated regulation of the activin membrane-bound inhibitor bone morphogenetic protein and activin membrane-bound inhibitor (BAMBI) through transforming growth factor-β (TGF-β) or β-catenin (CTNNB1) in HCC cells and in an animal model, and we compared its role to that of the full-length HBx protein. Ectopic ctHBx expression generated more colonies in anchorage-dependent and -independent growth assays than did HBx expression alone. ctHBx downregulated BAMBI to a greater degree than did HBx in HCC cells. HBx activated the Wnt/β-catenin pathway, which positively regulated the BAMBI expression through T-cell factor 1 signaling, whereas ctHBx negatively regulated the Wnt/β-catenin pathway. BAMBI downregulated the β-catenin and TGF-β1 signaling pathways. TGF-β1 positively regulated BAMBI expression thorough Smad3 signaling. Furthermore, knockdown of BAMBI was more tumorigenic in HCC cells. Therefore, downregulation of both β-catenin and TGF-β1 signaling by BAMBI might contribute to tumor suppression in mice xenotransplanted with HepG2 or SH-J1 cells. Taken together, ctHBx may have a more oncogenic role than HBx through its inhibition of tumor-suppressive β-catenin/BAMBI signaling.