Primary sclerosing cholangitis (PSC) is an idiopathic, chronic cholestatic liver disease of uncertain etiopathogenesis commonly associated with inflammatory bowel disease (IBD) and is characterized by patchy inflammation of the biliary tree progressing to fibrosis and strictures. The natural history of PSC is highly variable but characteristically follows a progressive clinical course leading to biliary tree strictures, cholestasis, and choledocholithiasis. The course of the disease may be complicated by cholangitis, secondary biliary cirrhosis, liver failure, and cholangiocarcinoma. The diagnosis of PSC is based on typical cholangiographic findings, supported by nonspecific clinical signs and symptoms, cholestatic liver biochemical tests, and liver biopsy. Uncommon and usually clinically obvious secondary causes of sclerosing cholangitis are excluded before establishing the diagnosis of PSC. Therapeutic approaches that show promise include endoscopic therapy and ursodeoxycholic acid. The only accepted therapy for end-stage PSC that can improve long-term outcome is liver transplantation. The diagnosis of cholangiocarcinoma--often difficult and elusive--usually precludes liver transplantation because its prognosis is very poor.