Purpose Retinoblastoma (RB) represents an adolescent eye malignancy. Long non-coding RNA (LncRNA) HOTAIR shows aberrant expression in many malignancies. This research investigated the mechanism of HOTAIR in RB. Methods Normal retinal cell lines (ARPE-19 and RPE-1) and RB cell lines (ORB50, Y79, HXO-RB44, and WERI-RB) were selected for detection of HOTAIR expression by qRT-PCR. sh-HOTAIR was delivered into Y79 and HXO-RB44 cells. Cell-cycle distribution, proliferation, and apoptosis were detected by CCK-8 assay and flow cytometry. Binding relationships among HOTAIR, miR-20b-5p, and RRM2 were confirmed using dual-luciferase assay. Roles of miR-20b-5p and RRM2 in RB cell-cycle distribution, proliferation, and apoptosis were ascertained by functional rescue experiments. Murine model of xenograft tumor was established, followed by detection of tumor growth and counting of Ki67-positive cells. Expressions of proliferation- and apoptosis-associated proteins and PI3K/AKT pathway-related proteins were determined by Western blot. Results HOTAIR was elevated in RB cells relative to that in normal retinal cells and showed relatively high expression in Y79 and HXO-RB44 cells. sh-HOTAIR induced RB cell-cycle arrest, restrained proliferation, and strengthened apoptosis. HOTAIR functioned as the ceRNA of miR-20b-5p and targeted RRM2. RB cells had poorly-expressed miR-20b-5p and highly-expressed RRM2. miR-20b-5p downregulation or RRM2 overexpression facilitated RB cell-cycle and proliferation, suppressed apoptosis, and reversed the protective effect of sh-HOTAIR on RB. sh-HOTAIR reduced tumor growth and Ki67-positive cells in vivo and inactivated PI3K/AKT pathway. Conclusion LncRNA HOTAIR upregulated RRM2 by competitively binding to miR-20b-5p and activated PI3K/AKT pathway, thereby facilitating proliferation and repressing apoptosis of RB cells.