Background: Hepatoblastoma (HB) is an embryonal liver neoplasm of early childhood with a poor prognosis for patients with distant metastases and vascular invasion. We and others have previously shown that the overexpression of insulin-like growth factor 2 (IGF2), loss of imprinting at the IGF2/H19 locus, and amplification of pleomorphic adenoma gene 1 (PLAG1) are common features in HB, suggesting a critical role of the IGF axis in hepatoblastomagenesis. In this study, we investigated the role of the insulin-like growth factor binding protein 3 (IGFBP3), a known competitor of the IGF axis, in pediatric liver cancers. Results: The IGFBP3 gene was highly expressed in normal pediatric livers but was heavily downregulated in four HB cell lines and the majority of HB primary tumors (26/36). Detailed methylation analysis of CpG sites in the IGFBP3 promoter region by bisulfite sequencing revealed a high degree of DNA methylation, which is causatively associated with the suppression of IGFBP3 in HB cell lines. Consequently, the treatment of HB cell lines with 5-aza-2'-deoxycytidine resulted in DNA demethylation and reactivation of the epigenetically silenced IGFBP3 expression. Interestingly, IGFBP3 promoter methylation predominantly occurred in metastatic HB with vascular invasion. Restoring IGFBP3 expression in HB cells resulted in reduced colony formation, migration, and invasion. Conclusion: This study provides the first direct evidence that the reactivation of IGFBP3 decreases aggressive properties of pediatric liver cancer cells and that IGFBP3 promoter methylation might be used as an indicator for vessel-invasive tumor growth in HB patients.