Clinical disorders that impair bile flow result in retention of bile acids and cholestatic liver injury, characterized by parenchymal cell death, bile duct proliferation, liver inflammation and fibrosis. However, the pathogenic role of bile acids in the development of cholestatic liver injury remains incompletely understood.In this review, we summarize the current understanding of this process focusing on the experimental and clinical evidence for direct effects of bile acids on each major cellular component of the liver: hepatocytes, cholangiocytes, stellate cells and immune cells. During cholestasis bile acids accumulated in the liver, causing oxidative stress and mitochondrial injury in hepatocytes. The stressed hepatocytes respond by releasing inflammatory cytokines through activation of specific signaling pathways and transcription factors. The recruited neutrophils and other immune cells then cause parenchymal cell death. In addition, bile acids also stimulate the proliferation of cholangiocytes and stellate cells that are responsible for bile duct proliferation and liver fibrosis. This review explores the evidence for bile acid involvement in these phenomena. The role of bile acid receptors, TGR5, FXR and the sphingosine-1-phosphate receptor 2 and the inflammasome are also examined. We hope that better understanding of these pathologic effects will facilitate new strategies for treating cholestatic liver injury.