Patients with primary sclerosing cholangitis (PSC) confer a high risk of cholangiocarcinoma (CCA). The molecular mechanisms of CCA development in PSC are incompletely understood, but pro-oncogenic processes resulting from chronic biliary inflammation are presumably of central importance. Distinguishing benign from malignant biliary strictures in PSC patients is challenging and accurately diagnosing CCA in PSC often requires a multifaceted approach involving imaging, serological testing, biliary brush cytology and fluorescence in situ hybridization (FISH). Lack of early detection tools leads to a late diagnosis in the majority of cases. Surgical resection or liver transplantation represent the only curative intent treatments in PSC-CCA, but is only an option for the small subset of patients where CCA is detected at an early stage. Current palliative treatment modalities result in only a modest increase in survival. Overall, PSC-CCA carries a dismal prognosis with a 5-year survival less than 20%. Advances aiming at improving strategies for early detection, treatment and surveillance of CCA will be essential to provide better future patient care for PSC patients. Herein, we review the pathogenetic mechanisms for PSC-CCA as well as strategies for diagnosing and managing premalignant and malignant stages of CCA in PSC. © 2019 The Authors. Liver International Published by John Wiley & Sons Ltd.