Hepatocellular carcinoma (HCC) is one of the most common malignancies with extremely high rates of occurrence and death. Long noncoding RNAs (lncRNAs) have been increasingly revealed to participate in tumorigenesis and development of multiple human cancers, including HCC. LINC00961 is a novel lncRNA which has been uncovered as a tumor suppressor in lung cancer and glioma. However, the role of LINC00961 in HCC has never been probed yet. Herein, we revealed a marked downregulation of LINC00961 in HCC tissues and cell lines. Correlation of low LINC00961 expression with poor outcomes in patients with HCC suggested LINC00961 as an independent predictor for HCC prognosis. Functionally, LINC00961 overexpression obviously inhibited cell proliferation, migration, and invasion in HCC cells. Mechanistically, LINC00961 regulated cardiolipin synthase 1 (CRLS1) expression via sponging miR‐5581‐3p. Importantly, both miR‐5581‐3p upregulation and CRLS1 inhibition led to an acceleration in cellular processes in HCC cells. At length, the rescue assays suggested that LINC00961 functioned in HCC through the miR‐5581‐3p/CRLS1 axis. On the whole, our findings disclosed that LINC00961 played a suppressive role in HCC progression via modulating miR‐5581‐3p/CRLS1, thus providing a potentially effective target for the prognosis and treatment of patients with HCC.