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Long non-coding RNAs (lncRNAs) play crucial roles in hepatocellular carcinoma (HCC), offering valuable insights for therapeutic development. However, the clinical significance and functional mechanisms of LINC00853 in HCC remain poorly understood. This study aimed to evaluate the prognostic value of LINC00853 in HCC patients, and to investigate its underlying mechanisms in regulating HCC. A cohort of 123 HCC patients was enrolled in this study. LINC00853 expression in tumor tissues was quantified by quantitative reverse transcription-PCR (qRT-PCR). Prognostic significance of LINC00853 was assessed using Kaplan-Meier curves and Cox regression models. In vitro functional assays, including Cell Counting Kit-8 (CCK-8) and Transwell assays, were conducted to evaluate the effects of LINC00853 knockdown on cell proliferation, migration, and invasion. The regulatory axis involving LINC00853, miR-16-5p, and programmed death-ligand 1 (PD-L1) was validated by dual-luciferase reporter assays. The role of LINC00853 in immune escape was investigated by co-culturing CD8+ T cells with HCC cells and measuring cytotoxic activity along with cytokine (TNF-α, IFN-γ, IL-10, and TGF-β) levels. LINC00853 was significantly overexpressed in HCC tissues and was associated with unfavorable prognosis. Silencing LINC00853 suppressed the proliferation, migration, and invasion of HCC cells. Mechanistically, LINC00853 functioned as a molecular sponge for miR-16-5p, thereby upregulating PD-L1 expression. In the co-culture system, LINC00853 knockdown enhanced CD8+ T cell cytotoxicity and promoted the secretion of inflammatory cytokines (TNF-α and IFN-γ), while reducing immunosuppressive factors (IL-10 and TGF-β). These effects were reversed by the miR-16-5p inhibitor. LINC00853 may serve as a novel prognostic marker for HCC. Knockdown of LINC00853 suppresses the progression and immune escape by targeting the miR-16-5p/PD-L1 axis, suggesting its potential as a therapeutic target.