Alcoholic hepatitis (AH) develops only in small proportion of heavy drinkers. To better understand the mechanisms underlying this disparity, we conducted a study to define the relationship between AH development and dysregulated immune responses that might be ameliorated by alcohol abstinence. Sixty-eight AH patients, 65 heavy drinking controls without liver disease (HDC), and 20 healthy controls (HC) were enrolled and followed up to 12 months. At the baseline, HDC and HC had no significant differences in their plasma levels of 38 inflammatory cytokines/chemokines measured using multiplex immunoassays. However, compared to HDC, AH patients had higher baseline levels of 11 cytokines/chemokines (TNF-α, IL-6, IL-8, IP10, IL-4, IL-9, IL-10, FGF-2, IL-7, IL-15, and TGF-α), but lower levels of the anti-inflammatory macrophage-derived chemokine (MDC). AH patients also had more activated, yet dysfunctional immune cells as monocytes, T cells, and B cells expressed higher levels of CD38 and CD69, but low levels of HLA-DR, CD80, and CD86 at baseline. In addition, CD4 T cells produced less IFN-γ in response to T cell stimulation. Upregulated IL-6, IL-8, CD38, and CD69 and downregulated MDC, HLA-DR, CD86, and CD80 correlated positively and negatively, respectively, with disease severity. Longitudinal analysis indicated that levels of IL-6, IL-8, CD38, and CD69 were reduced, whereas levels of MDC, HLA-DR, CD80, and CD86 were increased in abstinent AH patients. All of the cellular immune abnormalities were reversed by day 360 in abstinent AH patients; however, plasma levels of TNF-α, IL-8, IL-10, FGF-2, and IL-7 remained higher. Conclusion: AH patients were in a highly immune-dysregulated state, whereas HDC showed little evidence of immune activation. Alcohol abstinence reversed most, but not all, of the immunological abnormalities.