Hepatorenal syndrome (HRS) is a common complication of advanced cirrhosis, characterised by renal failure and major disturbances in circulatory function. Renal failure is caused by intense vasoconstriction of the renal circulation. The syndrome is probably the final consequence of extreme underfilling of the arterial circulation secondary to arterial vasodilatation in the splanchnic vascular bed. As well as the renal circulation, most extrasplanchnic vascular beds are vasoconstricted. The diagnosis of HRS is currently based on the exclusion of other causes of renal failure. The prognosis is very poor, particularly when there is rapidly progressive renal failure (type 1). Liver transplantation is the best option in patients without contraindications to the procedure, but it is not always possible owing to the short survival expectancy. Therapies introduced during the past few years, such as vasoconstrictor drugs (vasopressin analogues, alpha-adrenergic agonists) or the transjugular intrahepatic portosystemic shunt, are effective in improving renal function. Nevertheless, liver transplantation should still be done in suitable patients even after improvement of renal function because the outcome of HRS is poor. Finally, recent findings suggest that the risk of developing HRS in the setting of spontaneous bacterial peritonitis may be reduced by the administration of albumin together with antibiotic therapy, and that of HRS occurring in severe alcoholic hepatitis can be lowered by administration of pentoxifylline. Although these findings need to be confirmed, these two strategies represent innovative approaches to lower the frequency of HRS in clinical practice.