Primary sclerosing cholangitis (PSC) is a rare but important liver disease that leads to cirrhosis and need for liver transplantation in a high proportion of cases. The disease occurs in approximately 1 per 100,000 population per year, usually presents in adulthood, and affects men more often than women. Typical serum biochemical results, autoantibodies and liver biopsy are suggestive but not diagnostic of PSC, the diagnosis requiring cholangiographic demonstration of stricturing and dilatation of the intra- and/or extra-hepatic bile ducts. The natural history of PSC is variable, the average survival being 12 to 17 years. The cause of PSC is still unknown. Although considered an autoimmune disease, PSC has several atypical features and a strong genetic component. The therapy of PSC is unsatisfactory. Standard doses of ursodeoxycholic acid (UDCA) lead to improvements in biochemical abnormalities but not in histology, cholangiographic appearance or survival. Several innovative therapies have been tried in PSC, but with scant evidence of benefit. For patients with high grade strictures, endoscopic dilatation is beneficial. Liver transplantation is successful for end-stage liver disease due to PSC and improves survival. PSC may recur after transplantation but is rarely progressive. The most dreaded complication of PSC is cholangiocarcinoma. Diagnosis of this highly malignant tumor is difficult, and there are no biomarkers for its early detection. Liver transplantation for cholangiocarcinoma has an exceedingly poor outcome, although transplantation with neoadjuvant chemoirradiation holds promise in selected patients. Thus, significant opportunities remain for basic and clinical research into the cause, natural history, and therapy of PSC.