Hepatocellular carcinoma (HCC) is associated with genetic and nongenetic aberrations that impact multiple genes and pathways, including the frequently dysregulated transforming growth factor β (TGF-β) signaling pathway. The regulatory cytokine TGF-β and its signaling effectors govern a broad spectrum of spatiotemporally regulated molecular and cellular responses, yet paradoxically have dual and opposing roles in HCC progression. In the early stages of tumorigenesis, TGF-β signaling enforces profound tumor-suppressive effects, primarily by inducing cell cycle arrest, cellular senescence, autophagy, and apoptosis. However, as the tumor advances in malignant progression, TGF-β functionally switches to a pro-tumorigenic signal, eliciting aggressive tumor traits, such as epithelial–mesenchymal transition, tumor microenvironment remodeling, and immune evasion of cancer cells. On this account, the inhibition of TGF-β signaling is recognized as a promising therapeutic strategy for advanced HCC. In this review, we evaluate the functions and mechanisms of TGF-β signaling and relate its complex and pleiotropic biology to HCC pathophysiology, attempting to provide a detailed perspective on the molecular determinants underlying its functional diversion. We also address the therapeutic implications of the dichotomous nature of TGF-β signaling and highlight the rationale for targeting this pathway for HCC treatment, alone or in combination with other agents.