Objective: To assess the utility of liver function tests (LFTs) for early recognition and prediction of severity of dengue fever in hospitalized patients. Study Design: An analytical study. Place and duration of study: Services Institute of Medical Science and Fatima Memorial Hospital, Lahore, from September to December 2010. Methodology: Admited cases of dengue fever were divided into three groups: mild, moderate, and severe increases in aminotransferases. Elevation in LFTs was co-related with good or bad outcome i.e. (survival or complication free stay) or (death or complications). Results were analyzed in SPSS version 18. Results: Out of the 353 patients with mean age of 37.12 ± 15.45 years, 245 (69.4%) were males and 108 (30.6%) were females. Seventy ive patients (21.2%) had mild elevation of aminotransferases (twofold increases), 265 patients (75.1%) had moderate increases (three to fourfold), and 13 (3.7%) had severe (>4 fold increase). Alanine transaminase (ALT) was statistically higher in patients with septicemia, hepatic, and renal failure (p-value ≤0.05). Aspartate transaminase (AST) was higher in almost all complications. Prolonged hospital stay was associated with raised LFTs and greater complications and mortality. AST was found to be twice as much raised as ALT. Conclusion: AST and ALT were statistically higher in patients with worse outcome thus can lead to early recognition of high risk cases.