Portosystemic encephalopathy is a common complication of surgical portacaval shunts. Recently, transjugular intrahepatic portosystemic shunts have been proposed to produce portal decompression in a manner analogous to a side-to-side portacaval shunt, but with less morbidity. The incidence and clinical spectrum of portosystemic encephalopathy after transjugular intrahepatic portosystemic shunts, however, had not been previously prospectively defined. We therefore prospectively studied portosystemic encephalopathy in 30 patients undergoing transjugular intrahepatic portosystemic shunts and compared these findings with 25 patients concurrently undergoing sclerotherapy (controls). At entry, both study groups were comparable. Portosystemic encephalopathy was assessed by examining and grading mental status, asterixis, plasma ammonia and trail making tests. The portosystemic encephalopathy index was calculated from these parameters. Nine of 30 patients with transjugular intrahepatic portosystemic shunts experienced 24 episodes of acute portosystemic encephalopathy during follow-up; 6 of 9 had a history of portosystemic encephalopathy before transjugular intrahepatic portosystemic shunts and 5 of these 6 patients had Child C cirrhosis. Mental status and asterixis scores as well as portosystemic encephalopathy index worsened significantly in the first month after transjugular intrahepatic portosystemic shunts but showed some improvement thereafter. Increasing age, a medical history of portosystemic encephalopathy and trail scores for part B greater than 100 sec were predictors of portosystemic encephalopathy after transjugular intrahepatic portosystemic shunts. Portosystemic encephalopathy could be managed medically in all but one patient who underwent liver transplant. In contrast, there were no significant changes in mental status, asterixis, ammonia or trail scores over time in sclerotherapy controls. Only six episodes of encephalopathy occurred in endoscopic sclerotherapy patients over the duration of the study. Thus, overall risk of portosystemic encephalopathy after transjugular intrahepatic portosystemic shunts was higher than during sclerotherapy.