Abstract Background Human T-cell leukemia virus type 1 (HTLV-1) is an oncogenic retrovirus etiologically associated with adult T-cell leukemia (ATL). The HTLV-1 bZIP factor (HBZ), which is encoded by minus strand of provirus, is expressed in all ATL cases and supports the proliferation of ATL cells. However, the precise mechanism of growth promoting activity of HBZ is poorly understood. Results In this study, we showed that HBZ suppressed C/EBPα signaling activation induced by either Tax or C/EBPα. As mechanisms of HBZ-mediated C/EBPα inhibition, we found that HBZ physically interacted with C/EBPα and diminished its DNA binding capacity. Luciferase and immunoprecipitation assays revealed that HBZ repressed C/EBPα activation in a Smad3-dependent manner. In addition, C/EBPα was overexpressed in HTLV-1 infected cell lines and fresh ATL cases. HBZ was able to induce C/EBPα transcription by enhancing its promoter activity. Finally, HBZ selectively modulated the expression of C/EBPα target genes, leading to the impairment of C/EBPα-mediated cell growth suppression. Conclusion HBZ, by suppressing C/EBPα signaling, supports the proliferation of HTLV-1 infected cells, which is thought to be critical for oncogenesis.