Hedyotis Diffusa Willd (HDW), a Chinese herbal medicine, has been widely used as an adjuvant therapy against various cancers, including hepatocellular carcinoma (HCC). However, the underlying anticancer mechanisms are yet to be elucidated. In the present study, the anticancer effects of HDW were evaluated and the efficacy and safety of HDW combined with low-dose 5-fluorouracil (5-FU) were investigated. HepG2 cells were cultured in vitro and nude mouse xenografts were established in vivo. The proliferation of HepG2 cells was measured using the MTT method and flow cytometry. The mRNA and protein expression levels of cyclin-dependent kinase 2 (CDK2), cyclin E and E2F1 were examined using relative quantitative real-time PCR and western blot analysis, respectively. The results showed that water extract of HDW remarkably inhibited HepG2 cell proliferation in a dose-dependent manner via arrest of HepG2 cells at the G0/G1 phase and induction of S phase delay. This suppression was accompanied by a great decrease of E2F1 and CDK2 mRNA expression. In addition, HDW remarkably potentiated the anticancer effect of low-dose 5-FU in the absence of overt toxicity by downregulating the mRNA and protein levels of CDK2, cyclin E and E2F1. Our findings support the use of HDW as adjuvant therapy of chemotherapy and suggest that HDW may potentiate the efficiency of low-dose 5-FU in treating HCC.