The Hippo pathway plays an evolutionarily conserved fundamental role in controlling organ size in multicellular organisms. Importantly, evidence from studies of patient samples and mouse models clearly indicates that deregulation of the Hippo signaling pathway plays a crucial role in the initiation and progression of many different types of human cancers. The Hippo signaling pathway is regulated by various stimuli, such as mechanical stress, G-protein coupled receptor signaling, and cellular energy status. When activated, the Hippo kinase cascade phosphorylates and inhibits the transcription co-activator YAP (Yes-associated protein), and its paralog TAZ (transcriptional coactivator with PDZ-binding motif), resulting in their cytoplasmic retention and degradation. When the Hippo signaling pathway is inactive, dephosphorylated YAP/TAZ translocate into the nucleus and activate gene transcription through binding to TEAD (TEA domain) family and other transcription factors. Such changes in gene expression promote cell proliferation and stem cell/progenitor cell self-renewal but inhibit apoptosis, thereby coordinately promote increase in organ size, tissue regeneration, and tumorigenesis. In this review, we summarize the molecular mechanisms of the mammalian Hippo signaling pathway with special emphasis on the Hippo kinase cascade and its upstream signals, the Hippo signaling pathway regulation of YAP and the mechanisms of YAP in regulation of gene transcription.