Conventional T1-weighted spin echo (T1WSE) and T1-weighted magnetization transfer (MT) images were obtained in 26 patients with biopsy-proven cirrhosis (nine Child's grade A, 10 Child's grade B and seven Child's grade C). Four subjects showed no evidence of neuropsychiatric impairment on clinical, psychometric and electrophysiological testing, seven showed evidence of subclinical hepatic encephalopathy and 15 were classified as having overt hepatic encephalopathy. Signal intensities of basal ganglia nuclei (head of caudate, putamen, globus pallidus and thalamus) and adjacent brain parenchyma were measured and contrast calculated. On T1WSE imaging, contrast measurements of the globus pallidus were significantly greater in patients with neuropsychiatric dysfunction than in those who were unimpaired (p < 0.05). This was not observed in the other basal ganglia nuclei. Patients with subclinical and overt hepatic encephalopathy could not be distinguished on the basis of contrast measurements of the globus pallidus or of any other nucleus. T1WSE contrast measurements of the globus pallidus were increased with elevations in blood ammonia levels (p < 0.05) and with the severity of liver dysfunction, when graded according to the Pugh's score (p < 0.05) Those patients with the worst liver injury (Child's grade C) had significantly greater T1WSE pallidal contrast measurements (p < 0.05) than those patients with minimal liver injury (Child's grade A). The patients with intermediate liver damage (Child's grade B) could not be distinguished from the other two groups. While MT imaging highlighted the basal ganglia and showed a correlation between globus pallidus contrast and blood ammonia levels (p < 0.05), no other relationship between MT contrast measurements and either the degree of hepatic encephalopathy or the severity of liver dysfunction was found.