Some surgically resected small hepatocellular carcinoma (HCC) up to 2 cm in diameter have indistinct margins, and it is sometimes difficult to identify the margins of the cancer nodule in the resected specimen. We classified such tumors as small HCC with indistinct margins and carried out a morphological study to define their characteristics in comparison with small HCC with distinct margins as a control group. We have encountered 27 examples among 86 tumors smaller than 2.0 cm in diameter. The tumors of this type indistinctly retained the basic architecture of the background and were vaguely demarcated. Most tumors were uniformly composed of well-differentiated cancer tissue, which is characterized by increased cell density with increased nuclear/cytoplasm ratio, increased cytoplasmic eosinophilia, and irregular thin-trabecular pattern with occasional pseudoglandular pattern. Portal tracts were included within the cancerous tissue. There was a "replacing" growth pattern at the tumor/nontumor boundary. Four of the 27 lesions had a nodule-in-nodule appearance, and the inner nodules consisted of moderately differentiated HCC without portal tracts. In all of the small HCC with indistinct margins, tumor invasion into the portal vein and intrahepatic metastasis were not found. In a control group, the tumors were well-demarcated, and 53% of them were encapsulated. They were well-differentiated in 9, moderately differentiated in 38 and mixed well and moderately in 12. Tumor invasion into the portal vein and intrahepatic metastasis was found in 16 (27.1%) and 6 (10.2%), respectively.(ABSTRACT TRUNCATED AT 250 WORDS)