Liver cancer is the third most common cause of cancer death in the world. POZ/BTB and AT-hook-containing zinc finger protein 1 (PATZ1) is a transcription factor associated with the progression of various cancers. However, the role of PATZ1 in liver cancer progression remains poorly understood. Here, we report that PATZ1 regulates liver cancer proliferation by directly regulating CDKN1B in hepatocellular carcinoma HepG2 cells. PATZ1 level was found to be ectopically expressed in hepatocellular carcinoma cells as compared to normal primary human hepatocytes, thus affirming its relevance in liver cancer. Integrative microarray and chromatin immunoprecipitation coupled with high throughput sequencing (ChIP-Seq) analysis of PATZ1 revealed strong enrichment in gene ontology terms related to cellular proliferation. Functionally, siRNA-mediated PATZ1 knockdown in HepG2 cells led to an increased rate of colony formation, elevated Ki-67 expression and greater G1-S phase transition. Concordantly, the increase in cell proliferation is accompanied by suppressed expression of the cyclin-dependent kinase inhibitor CDKN1B. ChIP assay revealed strong binding of PATZ1 to the genomic loci flanking the transcriptional start site of CDKN1B which allows a positive regulation of its promoter activity. Additionally, PATZ1 cooperates with p53 and the absence of p53 abrogated the PATZ1-mediated regulation of CDKN1B expression. In conclusion, this study provides a novel mechanistic insight into the role of PATZ1 in liver cancer progression by its direct regulation of CDKN1B to modulate cell proliferation, thereby providing a promising therapeutic intervention to alleviate tumor burden in liver cancer.