In contrast to most other malignancies, hepatocellular carcinoma (HCC), which accounts for approximately 90% of primary liver cancers, arises almost exclusively in the setting of chronic inflammation. Irrespective of etiology, a typical sequence of chronic necroinflammation, compensatory liver regeneration, induction of liver fibrosis and subsequent cirrhosis often precedes hepatocarcinogenesis. The liver is a central immunomodulator that ensures organ and systemic protection while maintaining immunotolerance. Deregulation of this tightly controlled liver immunological network is a hallmark of chronic liver disease and HCC. Notably, immunotherapies have raised hope for the successful treatment of advanced HCC. Here we summarize the roles of specific immune cell subsets in chronic liver disease, with a focus on non-alcoholic steatohepatitis and HCC. We review new advances in immunotherapeutic approaches for the treatment of HCC and discuss the challenges posed by the immunotolerant hepatic environment and the dual roles of adaptive and innate immune cells in HCC.