A total of 128 surgically resected small hepatocellular carcinomas, measuring less than or equal to 3 cm in diameter, were studied by both macroscopic and histologic examinations. In 95 single nodular-type tumors of the 128 lesions, eight tumors were associated with the cancerous areas of well differentiated hepatocellular carcinoma around the nodule. These surrounding cancerous areas went undetected by both the preoperative radiological examinations and the gross findings of resected specimens. Based on the immunohistochemical findings, the labeling index, both of the proliferating cell nuclear antigen (PCNA) and of the Ki-67 in the surrounding cancerous areas, were lower than that of the main nodules but higher than in the nontumorous liver parenchyma in seven of eight cases. These results suggest that the main nodule was generated from the surrounding cancerous area, supporting the hypothesis of a stepwise progression of HCC. Even if the tumor seems to be a small and single nodular type, it is recommended that its surrounding areas should be closely examined and the surgical cutting margin should be made more than 1.0 cm away from the main nodule at hepatic resection.