Acute alcoholic hepatitis (AH) is a distinct clinical entity amongst patients with chronic alcohol abuse. Patients with severe AH are at risk of dying in about 20%-25% cases despite specific treatment with corticosteroids and/or pentoxifylline. Clearly, a need for an additional more effective treatment option is unmet currently. Liver transplantation (LT), a definitive treatment option for alcoholic cirrhosis requires 6 mo abstinence. However, this rule cannot be applied to patients with AH as these patients are actively drinking prior to their presentation. Shortage of donors, ethical issues, and fear of recidivism after transplantation with less than 6 mo pretransplant abstinence are some of the reasons behind this rule of 6 mo of abstinence and hesitancy of transplanting patients with AH. These issues are debated at length in this manuscript. Further, retrospective studies have shown that patients undergoing transplantation for alcoholic cirrhosis and having histological changes of AH have been shown to fare as well when compared to patients without these histological changes. Recently, French workers have reported a case matched prospective study showing encouraging data on the usefulness of LT for patients who are non-responders to corticosteroid and/or pentoxifylline therapy. Future studies are needed to identify patients with severe AH who are going to benefit most with LT. In the light of emerging data on the efficacy of LT in improving survival of patients with severe acute AH who do not respond to corticosteroids, the time is ripe to re-evaluate our policy of LT in patients with AH.