Bmi1 is overexpressed in one-third of hepatocellular carcinoma (HCC) patients and acts as an oncogene in hepatocarcinogenesis. However, the underlying mechanism is unclear. The role of TGFβ signalling in HCC is not well defined as well. Here, we report that TGFβ2 is a target of Bmi1 in HCC and has a tumour-suppressing role. In Bmi1-knockout mouse livers and HCC cell lines, TGFβ2/SMAD cascade proteins were upregulated. TGFβ2 expression was inversely correlated with Bmi1 expression in human and mouse HCC tissues. In vitro, Bmi1 knockdown activated TGFβ2/SMAD signalling and led to cell apoptosis via upregulation of p15 and p21. TGFβ2 inhibition rescued the inhibitory effect of Bmi1 knockdown on HCC cell survival, proliferation, and cell-cycle progression. In vivo, restoration of TGFβ2 expression blocked Bmi1/Ras-driven hepatocarcinogenesis in mice. Chromatin immunoprecipitation and luciferase reporter assays revealed that Bmi1 repressed TGFβ2 expression by binding to its promoter as a co-factor of polycomb repressor complex 1. Our findings elucidate the molecular mechanism underlying hepatic Bmi1-driven carcinogenesis and highlight the importance of TGFβ2 as a tumour suppressor in HCC development.