Ethanol is oxidized in the liver by three different enzyme systems, namely by alcohol dehidrogenase (ADH), the microsomal ethanol oxidizing system and catalase. Alcohol also undergoes a first pass metabolism in the gastric mucosa due to alcohol dehydrogenase. This first pass metabolism of ethanol is decreased in the alcoholic, in the fasted state, in the elderly and during cimetidine therapy leading to elevated alcohol blood-concentrations. Ethanol toxicity is closely related to its metabolism in the liver. Ethanol oxidation by ADH generates reducing equivalents (NADH) and acetaldehyde (AA). The elevated NADH/NAD ratio results in alterations of the intermediary metabolism of lipids, carbohydrates, proteins, purines, hormones and porphyrins. Furthermore, NADH flavours free radical production. The ethanol-associated redox changes are pronounced in the perivenular zone, since this is the area of low oxygen tension and of high ADH activity. In addition to NADH, AA exerts striking toxic effects on the hepatocyte. AA binds to cellular proteins and membranes including the mitochondria, microtubules, glutathion and various enzymes. In addition, AA and lactate stimulate collagen production in fibroblasts. AA-adducts stimulate the production of antibodies against AA-epitopes and could thus aggravate the liver injury. Chronic ethanol consumption results also in the microsomal induction of a specific ethanol-inducible form of cytochrome P--450, the cytochrome P--450IIE1 with high affinity not only to ethanol but also to some drugs (acetaminophen), procarcinogens (nitrosamines) and industrial agents (carbon tetrachloride). The interaction between ethanol metabolism and the metabolism of these compounds including vitamin A may also contribute to hepatic toxicity, since the susceptibility of the alcoholic toward those compounds is enhanced.