BACKGROUND Budd-Chiari syndrome is an uncommon disorder caused by obstruction to hepatic venous outflow, causing varying degrees of hepatic injury depending on the extent, severity, and acuity of the obstruction. METHODS We reviewed the indications for operative intervention and the results of treating 32 patients with Budd-Chiari syndrome seen at Toronto Hospital between 1968 and 1995. RESULTS Twenty-one patients underwent portosystemic shunt (PSS) and 7 patients underwent liver transplantation (LT) as their initial operative management. Three patients who initially had PSS subsequently required LT. Patients with cirrhosis found on biopsy and preservation of hepatocellular function were treated with PSS and showed no difference in outcome when compared with patients without cirrhosis (P = 0.35). Patients who were treated by PSS with retrohepatic vena caval compression, as shown by high caval gradients had outcomes similar to those for patients with low gradients (P = 0.31). Using the Kaplan-Meier method, 5-year survival of PSS patients was 57%. Liver transplantation was used to manage patients with hepatic decompensation, as well as patients with vena caval occlusion or failed PSS. The 5-year Kaplan-Meier survival for LT was 67%. CONCLUSIONS Both PSS and LT are effective options in the management of Budd-Chiari syndrome. Portosystemic shunt is the preferred initial approach even with cirrhosis or retrohepatic caval compression as long as there is preservation of liver function and a patent vena cava. Liver transplantation should be used as primary therapy for patients with irreversible hepatic decompensation or vena caval occlusion, and it can be an effective salvage procedure following failed PSS.