The methylated derivative of l-arginine, asymmetric dimethylarginine (ADMA) is synthesized in different mammalian tissues including the brain. ADMA acts as an endogenous, nonselective, competitive inhibitor of all three isoforms of nitric oxide synthase (NOS) and may limit l-arginine supply from the plasma to the enzyme via reducing its transport by cationic amino acid transporters. Hepatic encephalopathy (HE) is a relatively frequently diagnosed complex neuropsychiatric syndrome associated with acute or chronic liver failure, characterized by symptoms linked with impaired brain function leading to neurological disabilities. The l-arginine—nitric oxide (NO) pathway is crucially involved in the pathomechanism of HE via modulating important cerebral processes that are thought to contribute to the major HE symptoms. Specifically, activation of this pathway in acute HE leads to an increase in NO production and free radical formation, thus, contributing to astrocytic swelling and cerebral edema. Moreover, the NO-cGMP pathway seems to be involved in cerebral blood flow (CBF) regulation, altered in HE. For this reason, depressed NO-cGMP signaling accompanying chronic HE and ensuing cGMP deficit contributes to the cognitive and motor failure. However, it should be remembered that ADMA, a relatively little known element limiting NO synthesis in HE, may also influence the NO-cGMP pathway regulation. In this review, we will discuss the contribution of ADMA to the regulation of the NO-cGMP pathway in the brain, correlation of ADMA level with CBF and cognitive alterations observed during HE progression in patients and/or animal models of HE.