Glucose-regulated protein 78 (GRP78), a molecular chaperone widely elevated in human cancers, is critical for endoplasmic reticulum (ER) protein folding, stress signaling and PI3K/AKT activation. Genetic knockout models of GRP78 revealed that GRP78 maintains homeostasis of metabolic organs, including liver, pancreas and adipose tissues. Hepatocellular carcinoma (HCC) and cholangiocarcinoma (CC) are the most common liver cancers. There is a lack of effective therapeutics for HCC and CC, highlighting the need to further understand liver tumorigenic mechanisms. PTEN (phosphatase and tenson homolog deleted on chromosome 10), a tumor suppressor that antagonizes the PI3K/AKT pathway, is inactivated in a wide range of tumors, including 40-50% of human liver cancers. To elucidate the role of GRP78 in liver cancer, we created a mouse model with biallelic liver-specific deletion of Pten and Grp78 mediated by Albumin-Cre-recombinase (cP(f/f)78(f/f)). Interestingly, in contrast to PTEN, deletion of GRP78 was progressive but incomplete. At 3 months, cP(f/f)78(f/f) livers showed hepatomegaly, activation of lipogenic genes, exacerbated steatosis and liver injury, implying that GRP78 protects the liver against PTEN-null-mediated pathogenesis. Furthermore, in response to liver injury, we observed increased proliferation and expansion of bile duct and liver progenitor cells in cP(f/f)78(f/f) livers. Strikingly, bile duct cells in cP(f/f)78(f/f) livers maintained wild-type (WT) GRP78 level, whereas adjacent areas showed GRP78 reduction. Analysis of signaling pathways revealed selective JNK activation, β-catenin downregulation, along with PDGFRα upregulation, which was unique to cP(f/f)78(f/f) livers at 6 months. Development of both HCC and CC was accelerated and was evident in cP(f/f)78(f/f) livers at 8-9 months, coinciding with intense GRP78 expression in the cancer lesions, and GRP78 expression in adjacent normal areas reverted back to the WT level. In contrast, c78(f/f) livers showed no malignancy even at 14 months. These studies reveal that GRP78 is a novel regulator for PTEN-loss-mediated liver injury and cancer progression.