Regulatory factor X-1 (RFX-1) is a transcription factor that has been linked to negative regulation of tumor progression; however, its biological function and signaling cascades are unknown. Here, we performed several studies to elucidate the roles of RFX-1 in the regulation of SHP-1 in hepatocellular carcinoma (HCC) cells. Overexpression of RFX-1 resulted in the activation of SHP-1 and repressed colony formation of HCC cells. In addition, by a mouse xenograft model, we demonstrated that RFX-1 overexpression also inhibited the tumor growth of HCC cells in vivo, suggesting that RFX-1 is of potential interest for small-molecule-targeted therapy. We also found that SC-2001, a bipyrrole molecule, induced apoptosis in HCC cells through activating RFX-1 expression. SC-2001 induced RFX-1 translocation from the cytosol to nucleus, bound to the SHP-1 promoter, and activated SHP-1 transcription. In a xenograft model, knockdown of RFX-1 reversed the antitumor effect of SC-2001. Notably, SC-2001 is much more potent than sorafenib, a clinically approved drug for HCC, in in vitro and in vivo assays. Our study confirmed that RFX-1 acts as a tumor suppressor in HCC and might be a new target for HCC therapy. The findings of this study also provide a new lead compound for targeted therapy via the activation of the RFX-1/SHP-1 pathway.