Tumor cells induce an immunosuppressive microenvironment which leads towards tumor immune escape. Understanding the intricacy of immunomodulation by tumor cells is essential for immunotherapy. Indoleamine 2,3-dioxygenase (IDO) is an immunosuppressive enzyme which mediates tumor immune escape in various cancers including hepatocellular carcinoma (HCC). IDO up-regulation in HCC may lead to recruit-ment of regulatory T-cells into tumor microenvironment and therefore inhibit local immune responses and promote metastasis. HCC associated fibroblasts stimulate natural killer cells dysfunction through prostaglandin E2 and subsequently IDO promotes favorable condition for tumor metastasis. IDO up-regulation induces immunosuppression and may enhance the risk of hepatitis C virus and hepatitis B virus induced HCC. Therefore, IDO inhibitors as adjuvant therapeutic agents may have clinical implications in HCC. This review proposes future prospects of IDO not only as a therapeutic target but also as a prognostic marker for HCC.