Disruption of bile acid (BA) metabolism causes various liver diseases including hepatocellular carcinoma (HCC). However, the underlying molecular mechanism remains elusive. Here, we report that BA metabolism is directly controlled by a repressor function of YAP, which induces cholestasis by altering BA levels and composition via inhibiting the transcription activity of Fxr, a key physiological BA sensor. Elevated BA levels further activate hepatic YAP, resulting in a feedforward cycle leading to HCC. Mechanistically, Teads are found to bind Fxr in a DNA-binding-independent manner and recruit YAP to epigenetically suppress Fxr. Promoting BA excretion, or alleviating YAP repressor function by pharmacologically activating Fxr and inhibiting HDAC1, or overexpressing an Fxr target gene Bsep to promote BA exportation, alleviate cholestasis and HCC caused by YAP activation. Our results identify YAP's transcriptional repressor role in BA metabolism as a key driver of HCC and suggest its potential as a therapeutic target.