Ligand activation of peroxisome proliferator-activated receptor gamma (PPARgamma) has been reported to induce growth inhibition and apoptosis in various cancers including hepatocellular carcinoma (HCC). However, the effect of hepatitis B virus X protein (HBx) on PPARgamma activation has not been characterized in hepatitis B virus (HBV)-associated HCC. Herein, we demonstrated that HBx counteracted growth inhibition caused by PPARgamma ligand in HBx-associated HCC cells. We found that HBx bound to DNA binding domain of PPARgamma and HBx/PPARgamma interaction blocked nuclear localization and binding to recognition site of PPARgamma. HBx significantly suppressed a PPARgamma-mediated transactivation. These results suggest that HBx modulates PPARgamma function through protein-protein interaction.