Cancer stem cells (CSCs) in hepatocellular carcinoma (HCC) possess tumor-initiating, metastatic, and drug resistance properties. This study was conducted to evaluate the effects of PEGylated interferon-alpha 2a (PEG-IFN-alpha 2a) and 5-fluorouracil (5-FU) on the expression of CSC markers and on specific pathways that contribute to the propagation of CSCs in HCC. HCC was initiated in rats using a single intraperitoneal dose of diethylnitrosamine (DENA) (200 mg/kg) and promoted by weekly subcutaneous injections of carbon tetrachloride (CCl4) for 6 weeks. After the appearance of dysplastic nodules, the animals received PEG-IFN-alpha 2a or 5-FU for 8 weeks. CSC markers (OV6, CD90) and molecules related to transforming growth factor beta (TGF-beta) and other signaling pathways were assessed in hepatic tissues. The PEG-IFN-alpha 2a treatment effectively suppressed the hepatic expression of OV6 and CD90, ameliorated the diminished hepatic expression of TGF-beta receptor II (TGF-beta RII) and beta 2-spectrin (beta 2SP), and significantly reduced the elevated hepatic expression of TGF-beta 1, interleukin6 (IL6), signal transducer and activator of transcription3 (STAT3), and vascular endothelial growth factor (VEGF). In contrast, the 5-FU treatment failed to reduce the overexpression of CSC markers and barely affected the disrupted TGF-beta signaling. Furthermore, it had no effect on angiogenesis or nitrosative stress. PEG-IFN-alpha 2a, but not 5-FU, could reduce the propagation of CSCs during the progression of HCC by upregulating the disrupted TGF-beta signaling, suppressing the IL6/STAT3 pathway and reducing angiogenesis.