Recent progress has enhanced our understanding of the pathogenesis of cholestatic liver diseases. Mutations in genes encoding for hepatobiliary transport systems can cause hereditary cholestatic syndromes and exposure to cholestatic agents (drugs, hormones, inflammatory cytokines) can lead to reduced expression and function of hepatic uptake and excretory systems in acquired forms of cholestasis. In addition to transporter changes which cause or maintain cholestasis, some alterations in transporter gene expression can be viewed as hepatoprotective mechanisms aimed at reducing intrahepatic accumulation of toxic biliary constituents such as bile acids and bilirubin. Alternative excretion of bile acids via the basolateral membrane into the systemic circulation facilitates the renal elimination of bile acids into urine. Moreover, increased bile acid hydroxylation, sulfation and glucuronidation by phase I and II metabolizing enzymes renders bile acids more hydrophilic and less toxic. These molecular changes are mediated by specific nuclear receptors which are regulated by bile acids, proinflammatory cytokines, drugs, and hormones. In addition to transcriptional changes, reduced transporter protein insertion to or increased retrieval from the cell membrane as well as other mechanisms such as altered cell polarity, disruption of cell-to-cell junctions and cytoskeletal changes are involved in the pathogenesis of cholestasis. Understanding the detailed mechanisms regulating expression of transport systems and enzymes is essential for the development of novel therapeutic agents. Such future approaches could specifically target nuclear receptors thus restoring defective transporter expression and supporting hepatic defense mechanisms against toxic bile acids.