Abstract Although there are many studies on the relationship between genetic polymorphisms and the incidence of diseases, mechanisms are rarely known. We report the mechanism by which signal transducer and activator of transcription 4 (stat4) rs7574865 promotes the occurrence and progression of hepatocellular carcinoma (HCC). We found that the GG genotype at stat4 rs7574865 was a risk genotype, and STAT4 levels in serum and peritumoral tissue from HCC patients with the GG genotype were significantly higher than those found in TT or TG carriers. Furthermore, HCC patients with the GG genotype or elevated STAT4 levels had poor prognoses. In vitro experiments demonstrated that STAT4 silencing promoted apoptosis and inhibited the invasion and migration of HepG2 and L02 cells. Proteomic analysis of HCC peritumors identified 273 proteins related to STAT4, of which CYP2E1 activity and FGL2 content exhibited the highest positive correlation. The relationship between CYP2E1 and FGL2 was also confirmed in cyp2e1 −/− mice and in CYP2E1 inhibitor-treated mice. In conclusion, this study elucidates the mechanism by which the stat4 rs7574865 polymorphism promotes the occurrence and progression of HCC via the Stat4/CYP2E1/FGL2 pathway.