Arachidonic acid metabolites are involved in a wide spectrum of hepatobiliary physiologic functions and disease. Prostanoids alter hepatic bile flow. Prostaglandins with a C9 ketooxygen stimulate a bicarbonate-rich choleresis and those with a C9 hydroxyloxygen produce a chloride-rich choleresis. Prostaglandin F2 alpha stimulates the release of the potent choleretic glucagon and the stimulatory effect of prostaglandin F2 alpha on bile flow is inhibited by cyclooxygenase inhibitors, suggesting that prostaglandins play a role in the release of choleretic hormones as well as in their action. Prostanoids are involved in gallbladder contraction and water absorption. Prostaglandins produce gallbladder contraction in various species and cause gallbladder relaxation in other species. Prostaglandins also may be mediators of cholecystokinetic hormone action; however, cyclooxygenase inhibitors do not inhibit the effect of cholecystokinetic hormones in all species. Prostanoids alter the normal process of water absorption by gallbladder mucosa and induce net water secretion. The inflamed gallbladder secretes rather than absorbs fluid. The demonstration that prostaglandin E2 inhibits gallbladder fluid absorption has led to subsequent studies that demonstrated that the secretion of fluid into the inflamed gallbladder lumen may be mediated by prostanoids. In cholecystitis, the prostanoids may mediate the distention produced by mucosal fluid secretion and the contraction of the diseased gallbladder. The inflammatory changes produced in various experimental models of cholecystitis can be prevented by cyclooxygenase inhibitors. Cyclooxygenase inhibitors decrease gallbladder prostaglandin formation and are effective in producing relief of the symptoms of gallbladder disease. In experimental cholesterol gallstone formation, prostaglandins are involved in the production of mucin, which acts as a nidus for stone formation, and cyclooxygenase inhibitors prevent the formation of experimental cholesterol gallstones. Prostaglandins have been shown to be cytoprotective in various types of experimental hepatic injury and leukotrienes have been shown to be injurious to hepatocytes and biliary tract tissues. Specific prostanoids and lipoxygenase inhibitors may be valuable in treating patients with various acute hepatic inflammatory disease processes. Continued evaluation of the role of arachidonic acid metabolites in hepatobiliary physiology and disease may lead to important new therapeutic modalities.