Alcoholic liver disease (ALD) is the most prevalent type of chronic liver disease worldwide. ALD can progress from alcoholic fatty liver (AFL) to alcoholic steatohepatitis (ASH), which is characterized by hepatic inflammation. Chronic ASH can eventually lead to fibrosis and cirrhosis and in some cases hepatocellular cancer (HCC). In addition, severe ASH (with or without cirrhosis) can lead to alcoholic hepatitis, which is an acute clinical presentation of ALD that is associated with liver failure and high mortality. Most individuals consuming >40 g of alcohol per day develop AFL; however, only a subset of individuals will develop more advanced disease. Genetic, epigenetic and non-genetic factors might explain the considerable interindividual variation in ALD phenotype. The pathogenesis of ALD includes hepatic steatosis, oxidative stress, acetaldehyde-mediated toxicity and cytokine and chemokine-induced inflammation. Diagnosis of ALD involves assessing patients for alcohol use disorder and signs of advanced liver disease. The degree of AFL and liver fibrosis can be determined by ultrasonography, transient elastography, MRI, measurement of serum biomarkers and liver biopsy histology. Alcohol abstinence achieved by psychosomatic intervention is the best treatment for all stages of ALD. In the case of advanced disease such as cirrhosis or HCC, liver transplantation may be required. Thus, new therapies are urgently needed.