Tumor necrosis factor-inducible gene 6 protein (TSG-6) is a cytokine secreted by mesenchymal stem cells (MSCs) and regulates MSC stemness. We previously reported that TSG-6 changes primary human hepatic stellate cells (pHSCs) into stem-like cells by activating yes-associated protein-1 (YAP-1). However, the molecular mechanism behind the reprogramming action of TSG-6 in pHSCs remains unknown. Cluster of differentiation 44 (CD44) is a transmembrane protein that has multiple functions depending on the ligand it is binding, and it is involved in various signaling pathways, including the Wnt/-catenin pathway. Given that -catenin influences stemness and acts downstream of CD44, we hypothesized that TSG-6 interacts with the CD44 receptor and stimulates -catenin to activate YAP-1 during TSG-6-mediated transdifferentiation of HSCs. Immunoprecipitation assays showed the interaction of TSG-6 with CD44, and immunofluorescence staining analyses revealed the colocalization of TSG-6 and CD44 at the plasma membrane of TSG-6-treated pHSCs. In addition, TSG-6 treatment upregulated the inactive form of phosphorylated glycogen synthase kinase (GSK)-3, which is a negative regulator of -catenin, and promoted nuclear accumulation of active/nonphosphorylated -catenin, eventually leading to the activation of YAP-1. However, CD44 suppression in pHSCs following CD44 siRNA treatment blocked the activation of -catenin and YAP-1, which inhibited the transition of TSG-6-treated HSCs into stem-like cells. Therefore, these findings demonstrate that TSG-6 interacts with CD44 and activates -catenin and YAP-1 during the conversion of TSG-6-treated pHSCs into stem-like cells, suggesting that this novel pathway is an effective therapeutic target for controlling liver disease.