The farnesoid X receptor (FXR) controls the synthesis and transport of bile acids (BAs). Mice lacking expression of FXR, designated Fxr-null, have elevated levels of serum and hepatic BAs and an increase in BA pool size. Surprisingly, at 12 months of age, male and female Fxr-null mice had a high incidence of degenerative hepatic lesions, altered cell foci and liver tumors including hepatocellular adenoma, carcinoma and hepatocholangiocellular carcinoma, the latter of which is rarely observed in mice. At 3 months, Fxr-null mice had increased expression of the proinflammatory cytokine IL-1beta mRNA and elevated beta-catenin and its target gene c-myc. They also had increased cell proliferation as revealed by increased PCNA mRNA and BrdU incorporation. These studies reveal a potential role for FXR and BAs in hepatocarcinogenesis.