Hepatic encephalopathy is a neurological syndrome occurring in patients with liver failure or in those with a large porto-systemic shunt. In cirrhotic patients, the current classification comprises covert and overt encephalopathy. Diagnosis of covert encephalopathy requires sensitive tests. Lactulose and rifaximin are the two leading therapeutic options. Rifaximin is efficacious for maintaining remission from hepatic encephalopathy. Liver transplantation should be discussed in cirrhotic patients with encephalopathy.