Effect of ursodeoxycholic acid (600 mg/day 12 weeks) on liver function tests and bile acid metabolism were investigated in 6 patients with compensatory liver cirrhosis (CLC) and 6 with chronic active hepatitis (CAH). Serial determination of serum GOT, GPT and gamma-GTP after the initiation of UDCA revealed significant reduction in mean levels of these enzymes after 4 weeks, and further improvement was observed at the end of the 12-weeks treatment regimen (CLC: 79.3%, 81.1%, 51.5% of initial values, respectively, CAH: 61.2%, 59.3%, 42.8%). On the other hand, after UDCA administration, serum total bile acid increased and UDCA became the predominant bile acid in CLC and CAH patients. Other endogenous bile acids decreased in both groups, but reduction rate of serum chenodeoxycholic acid level in CLC was smaller than that in CAH group (CLC: 86.1% of initial values, respectively, CAH: 54.2%). During UDCA treatment, apparent side effect was not observed. We suggest that UDCA administration might constitute effective treatment for compensatory liver cirrhosis as well as chronic hepatitis.