Hepatocellular carcinoma (HCC)-associated macrophages accelerate tumor progression via growth factor release. Therefore, tumor-associated macrophages (TAMs)-initiated signaling cascades are potential therapeutic targets. To better understand anticancer effects of systemic HCC therapy, we studied sorafenib's effect on macrophage function, focusing on macrophage-related growth factor secretion. We found that dual specificity phosphatase 1 (DUSP1) is a direct target of miR-101. Transfection of miR-101 reduced DUSP1 induction in M2 macrophages and prolonged ERK1/2, p38 and JNK activation, whereas inhibition of miR-101 enhanced DUSP1 expression and decreased ERK1/2, p38 and JNK activation. miR-101 expression was decreased by sorafenib, and inhibition of PI3K/AKT blocked induction of miR-101 by LPS in M2 cells. M2 cells with greater TGF-β and CD206 mRNA expression compared to M1 cells had increased hepatoma growth, metastases and EMT. Sorafenib inhibited miR-101 expression and enhanced DUSP1 expression and lowered TGF-β and CD206 release in M2 cells, slowing macrophage-driven HCC. Our studies demonstrate miR-101 regulates macrophage innate immune responses to LPS via targeting DUSP1. Sorafenib alters macrophage polarization, reduces TGF-β driven cancer growth, metastases and EMT in vitro, and partially inhibits macrophage activation in vivo. Thus, macrophage modulation might explain the anticancer effects of sorafenib.