Background and Aims: Cholesterol ester (CE) biosynthesis and homeostasis play critical roles in many cancers, including HCC, but their exact mechanistic contributions to HCC disease development require further study. Approach and Results: Here, we report on a proposed role of tumor suppressor P53 in its repressing ubiquitin‐specific peptidase 19 (USP19) and sterol O‐acyltransferase (SOAT) 1, which maintains CE homeostasis. USP19 enhances cholesterol esterification and contributes to hepatocarcinogenesis (HCG) by deubiquitinating and stabilizing SOAT1. Loss of either SOAT1 or USP19 dramatically attenuates cholesterol esterification and HCG in P53‐deficient mice fed with either a normal chow diet or a high‐cholesterol, high‐fat diet (HCHFD). SOAT1 inhibitor avasimibe has more inhibitory effect on HCC progression in HCHFD‐maintained P53‐deficient mice when compared to the inhibitors of de novo cholesterol synthesis. Consistent with our findings in the mouse model, the P53‐USP19‐SOAT1 signaling axis is also dysregulated in human HCCs. Conclusions: Collectively, our findings demonstrate that SOAT1 participates in HCG by increasing cholesterol esterification, thus indicating that SOAT1 is a potential biomarker and therapeutic target in P53‐deficient HCC.