Background: The aim of this study was to assess the validity of the 7th edition of the American Joint Committee on Cancer (AJCC) TNM system (TNM-7) for patients undergoing hepatectomy for hepatocellular carcinoma (HCC). Methods: Partial hepatectomies performed for 879 patients from 1993 to 2005 were retrospectively reviewed. Clinicopathological factors, surgical outcome, overall survival (OS), and disease-free survival (DFS) were analyzed to evaluate the predictive value of the TNM-7 staging system. Results: According to the TNM-7 system, differences in five-year survival between stages I, II, and III were statistically significant. Subgroup analysis of stage III patients revealed that the difference between stages II and IIIA was not significant (OS, p = 0.246; DFS, p = 0.105). Further stratification of stages IIIA, IIIB and IIIC also did not reveal significant differences. Cox proportional hazard models of stage III analyses identified additional clinicopathological factors affecting patient survival: lack of tumor encapsulation, aspartate aminotransferase (AST) values > 68 U/L, and blood loss > 500 mL affected DFS whereas lack of tumor encapsulation, AST values > 68 U/L, blood loss > 500 mL, and serum α-fetoprotein (AFP) values > 200 ng/mL were independent factors impairing OS. Stage III factors including tumor thrombus, satellite lesions, and tumor rupture did not appear to influence survival in the stage III subgroup. Conclusions: In terms of 5-year survival rates, the TNM-7 system is capable of stratifying post-hepatectomy HCC patients into stages I, II, and III but is unable to stratify stage III patients into stages IIIA, IIIB and IIIC. Lack of tumor encapsulation, AST values > 68 U/L, blood loss > 500 mL, and AFP values > 200 ng/mL are independent prognostic factors affecting long-term survival.