Hepatopulmonary syndrome (HPS) is an important cause of dyspnea and hypoxia in the setting of liver disease, occurring in 10-30% of patients with cirrhosis. It is due to vasodilation and angiogenesis in the pulmonary vascular bed, which leads to ventilationperfusion mismatching, diffusion limitation to oxygen exchange, and arteriovenous shunting. There is evidence, primarily from animal studies, that vasodilation is mediated by a number of endogenous vasoactive molecules, including endothelin-1 and nitric oxide (NO). In experimental HPS, liver injury stimulates release of endothelin-1 and results in increased expression of ETB receptors on pulmonary endothelial cells, leading to upregulation of endothelial NO synthase (eNOS) and subsequent increased production of NO, which causes vasodilation. In addition, increased phagocytosis of bacterial endotoxin in the lung not only promotes stimulation of inducible NO synthase, which increases NO production, but also contributes to intrapulmonary accumulation of monocytes, which may stimulate angiogenesis via vascular endothelial growth factor pathway. Despite these insights into the pathogenesis of experimental HPS, there is no established medical therapy, and liver transplantation remains the main treatment for symptomatic HPS, although selected patients may benefit from other surgical or radiological interventions. In this review, we focus on recent advances in our understanding of the pathophysiology of HPS, and discuss current approaches to the investigation and treatment of this condition.