Abstract Elucidating mechanisms of hepatitis B virus (HBV)–mediated hepatocarcinogenesis is needed to gain insights into the etiology and treatment of liver cancer. Cells where HBV is replicating exhibit increased expression of Plk1 kinase and reduced levels of two transcription repression factors, SUZ12 and ZNF198. SUZ12 is an essential subunit of the transcription repressive complex PRC2. ZNF198 stabilizes the transcription repressive complex composed of LSD1, Co-REST, and HDAC1. These two transcription repressive complexes are held together by binding the long noncoding RNA HOTAIR. In this study, we linked these regulatory events mechanistically by showing that Plk1 induces proteasomal degradation of SUZ12 and ZNF198 by site-specific phosphorylation. Plk1-dependent ubiquitination of SUZ12 and ZNF198 was enhanced by expression of HOTAIR, significantly reducing SUZ12 and ZNF198 stability. In cells expressing the HBV X protein (HBx), downregulation of SUZ12 and ZNF198 mediated global changes in histone modifications. In turn, HBx-expressing cells propagated an altered chromatin landscape after cell division, as exemplified by changes in histone modifications of the EpCAM promoter, a target of PRC2 and LSD1/Co-REST/HDAC1 complexes. Notably, liver tumors from X/c-myc bitransgenic mice exhibited downregulation of SUZ12 and ZNF198 along with elevated expression of Plk1, HOTAIR, and EpCAM. Clinically, similar effects were documented in a set of HBV-related liver tumors consistent with the likelihood that downregulation of SUZ12 and ZNF198 leads to epigenetic reprogramming of infected hepatocytes. Because both Plk1 and HOTAIR are elevated in many human cancers, we propose that their combined effects are involved in epigenetic reprogramming associated broadly with oncogenic transformation. Cancer Res; 75(11); 2363–74. ©2015 AACR.