BACKGROUND: Induction and promotion of liver cancer by exposure to non-genotoxic carcinogens coincides with epigenetic perturbations, including specific changes in DNA methylation. Here we investigate the genome-wide dynamics of 5-hydroxymethylcytosine (5hmC) as a likely intermediate of 5-methylcytosine (5mC) demethylation in a DNA methylation reprogramming pathway. We use a rodent model of non-genotoxic carcinogen exposure using the drug phenobarbital. RESULTS: Exposure to phenobarbital results in dynamic and reciprocal changes to the 5mC/5hmC patterns over the promoter regions of a cohort of genes that are transcriptionally upregulated. This reprogramming of 5mC/5hmC coincides with characteristic changes in the histone marks H3K4me2, H3K27me3 and H3K36me3. Quantitative analysis of phenobarbital-induced genes that are involved in xenobiotic metabolism reveals that both DNA modifications are lost at the transcription start site, while there is a reciprocal relationship between increasing levels of 5hmC and loss of 5mC at regions immediately adjacent to core promoters. CONCLUSIONS: Collectively, these experiments support the hypothesis that 5hmC is a potential intermediate in a demethylation pathway and reveal precise perturbations of the mouse liver DNA methylome and hydroxymethylome upon exposure to a rodent hepatocarcinogen.