The role of fine needle aspiration (FNA) biopsy of the liver has evolved. Advances in imaging modalities have obviated the need for tissue confirmation in clinically classic hepatocellular carcinoma (HCC). The risks of needle tract seeding and haematogenous dissemination have been actively debated. Nowadays, cytopathologists are confronted by smaller and smaller nodules, detected due to increased surveillance of high-risk cirrhotic patients. Tissue characterization of small well-differentiated hepatocellular nodular lesions (size less than and equal to 2 cm) is extremely challenging and has therapeutic implications. Major issues in the cytodiagnosis of HCC include: (i) distinguishing benign hepatocellular nodular lesions, namely, large regenerative nodules, dysplastic nodules, focal nodular hyperplasia and hepatocellular adenoma from reactive hepatocytes; (ii) distinguishing well-differentiated HCC from benign hepatocellular nodular lesions; (iii) distinguishing poorly differentiated HCC from intrahepatic cholangiocarcinoma and metastatic carcinomas; (iv) determining the histogenesis of a malignant tumour; and (v) determining the site of origin of a malignant tumour. An overview of the biological evolution and histopathological aspects of dysplastic nodules, small HCCs and 'nodule-in-nodule' lesions is presented in tandem with clinically relevant nomenclature. An algorithmic approach to FNA diagnosis of HCC and hepatocellular nodular lesions is outlined. Optimal results depend on (i) a dedicated radiologist-cytopathologist team; (ii) an on-site cytology service, (iii) a combined cytohistological approach, (iv) immunohistochemistry, and (v) clinicopathological correlation. As we move towards personalized medicine, it is envisaged that hepatic FNA is likely to become a point of care in the management protocol as it takes on the additional role of procurement of tumour and peritumoural tissues for genomic and proteomic profiling to enable targeted molecular therapy.