The neuropeptide diazepam binding inhibitor (DBI) is an endogeneous allosteric modulator of gamma-aminobutyric acid (GABA) receptors at the benzodiazepine recognition site. Recent theories on the neurochemical cause for hepatic encephalopathy have implicated activation of inhibitory neurotransmitter GABA systems. In 20 patients with hepatic disease, blood and cerebrospinal fluid (CSF) levels of ammonia and amino acids were measured. As in previous studies there was a selective elevation of CSF amino acids as well as a correlation between CSF glutamine levels and encephalopathy. CSF DBI levels were maximally elevated 5-fold in patients with hepatic encephalopathy, but they were normal in those patients with liver disease not associated with changes in mental status and in patients with nonhepatic encephalopathy. Levels of DBI correlated with the clinical staging of hepatic encephalopathy. These data suggest that DBI may participate in the modulation of cerebral function in hepatic encephalopathy.