Hepatocellular carcinoma is a malignancy that predominantly occurs in the setting of cirrhosis. Its incidence is rising worldwide. Hepatocellular carcinoma differs from most malignancies because it is commonly diagnosed on the basis of imaging features alone, without histologic confirmation. The guidelines from the American Association for the Study of Liver Diseases (AASLD) are a leading statement for the diagnosis and staging of hepatocellular carcinoma, and they have recently been updated, incorporating several important changes. AASLD advocates the use of the Barcelona Clinic Liver Cancer (BCLC) staging system, which combines validated imaging and clinical predictors of survival to determine stage and which links staging with treatment options. Each stage of the BCLC system is outlined clearly, with emphasis on case examples. Focal liver lesions identified at ultrasonographic surveillance in patients with cirrhosis require further investigation. Lesions larger than 1 cm should be assessed with multiphasic computed tomography or magnetic resonance imaging. Use of proper equipment and protocols is essential. Lesions larger than 1 cm can be diagnosed as hepatocellular carcinoma from a single study if the characteristic dynamic perfusion pattern of arterial hyperenhancement and venous or delayed phase washout is demonstrated. If the imaging characteristics of hepatocellular carcinoma are not met, the alternate modality should be performed. Biopsy should be used if neither modality is diagnostic of hepatocellular carcinoma. Once the diagnosis has been made, the cancer should be assigned a BCLC stage, which will help determine suitable treatment options. Radiologists require a systematic approach to diagnose and stage hepatocellular carcinoma with appropriate accuracy and precision.