A toxic effect of alcohol is the principal cause of the development of liver disease in alcoholism. Fatty infiltration of the liver is a consequence of ethanol metabolism due mainly to an increased synthesis and decreased degradation of fatty acids. Mechanisms that have been suggested for ethanol-induced hepatocellular necrosis include centrolobular hypoxia due to an increased oxygen requirement and intracellular accumulation of protein, fat, and water which results in increased cell size. Hepatocellular necrosis, however, may not be a necessary stage in the development of cirrhosis. Chronic ethanol administration increases hepatic collagen deposition, and acute and chronic ethanol administration inhibit liver cell regeneration. Increased humoral and cellular immunological activity to liver tissue and its components may contribute to the persistence of liver disease in the alcoholic. However, only a small proportion of alcoholics and baboons fed alcohol develop cirrhosis, suggesting that other factors, either genetic, environmental, or nutritional, play a role. Malnutrition is common in alcoholics. Liver disease is more common in some malnourished populations, and has been produced by nutrient deficiencies. Decreased dietary intake, as well as malabsorption and alterations in the metabolism of nutrients, are causes of nutrient deficiencies in alcoholism. Some of the effects of alcohol on the liver may be mediated by its actions on nutrient absorption and metabolism.