The hepatic encephalopathy (HE) may develop during chronic liver diseases like liver cirrhosis, portal-systemic shunts or acute liver failure. The central nervous system and cognitive as well as neuromuscular functions, the personality, the consciousness are being impaired. Lately the latent HE, however, has gained increasing clinical attention and importance because of its subtle changes in cognitive functions which can only be diagnosed by psychometric or elaborated neurophysiological tests. Endogenous neurotoxins, false neurotransmitters or subtle metabolic changes in the complex interactions with the appropiate receptors are being discussed. The identification and possible elimination of precipitating factors, diet, protein restriction and lactulose, lactitol are being discussed as therapeutic possibilities. In severe cases branched and ammonia-decreasing amino acids combined with non-absorbable antibiotics are of therapeutic values. The clinical symptoms of the HE can change quickly. The HE is potential reversible if the developing alterations and symptoms are diagnosed correctly.