Autophagy is a pathophysiological phenomenon in liver cirrhosis that can further progress into hepatocarcinoma. Liver cancer stem cells (CSCs) are believed to initiate hepatocarcinogenesis. To investigate the precise mechanism related to the origin of CSCs in liver cirrhosis and hepatocarcinogenesis, we labeled Axin2+ hepatic cells with EGFP in Axin2Cre;Rosa26EGFP transgenic rats, and then stratified clinical and rat liver cirrhosis samples by autophagy flux. Clinical follow-up and lineage tracing in transgenic rat liver cirrhosis revealed that while Axin2/EGFP+ hepatic cells were present in normal livers and cirrhotic livers without aberrant autophagy, hepatic Axin2/EGFP+CD90+ cells were generated exclusively in cirrhotic livers with aberrant autophagy and promoted hepatocarcinogenesis. Aberrant autophagy in liver cirrhosis resulted in hepatocyte growth factor (HGF) expression, leading to activation of Met/JNK and Met/STAT3 signaling in sorted hepatic Axin2/EGFP+ cells and their transition into Axin2/EGFP+CD90+ cells that possess CSC properties. In a transgenic rat liver cirrhosis model, induction or inhibition of autophagy in cirrhotic livers by systemic administration of rapamycin or chloroquine or transfection with Atg3- and Atg7-shRNAs significantly induced or suppressed HGF expression, which in turn increased or reduced generation of EGFP+CD90+ hepatic cells by activating or inactivating Met/JNK and Met/STAT3 signaling, thereby promoting or preventing hepatocarcinogenesis. Systemic treatment with HGF-shRNA, SP600125 or stattic also reduced generation of EGFP(Axin2)+ hepatic cell-originated CD90+ CSCs in aberrant autophagic cirrhotic livers by inactivating HGF/Met/JNK or HGF/Met/STAT3 signaling, further preventing hepatocarcinogenesis. These data suggest that activation of Met/JNK and Met/STAT3 signaling in Axin2+ hepatic cells via autophagy-dependent HGF expression and the resultant generation of Axin2+CD90+ CSCs is a major mechanism of hepatocarcinogenesis in cirrhotic livers.