CD133⁺ cancer stem cells (CSC) contribute to hepatocellular carcinoma (HCC) progression and resistance to therapy. Bone morphogenetic protein BMP4 plays an important role in hepatogenesis and hepatic stem cell differentiation, but little is known about its function in hepatic CSCs. In this study, we showed that high-dose exogenous BMP4 promotes CD133⁺ HCC CSC differentiation and inhibits the self-renewal, chemotherapeutic resistance, and tumorigenic capacity of these cells. Interestingly, we found that low-dose exogenous BMP4 upregulated CD133 protein expression in vitro, and endogenous BMP4 was preferentially expressed in CD133⁺ HCC CSCs, suggesting that low doses of BMP4 may facilitate CSC maintenance. A reduction in endogenous BMP4 levels decreased CD133 protein expression in vitro. In HCC tissues, expression of the BMP4 signaling target gene SMAD6 was positively correlated with CD133 expression. Activation of the Erk1/2 signaling pathway led to BMP4-mediated reduction in CD133 expression, which was reversed by treatment with MEK inhibitors. Taken together, our findings indicated that BMP4 might be a potent therapeutic agent in HCC that targets CSCs. Cancer Res; 72(16); 4276–85. ©2012 AACR.