Primary sclerosing cholangitis (PSC) is a chronic cholestatic liver disease characterized by fibrosing inflammation and obliteration of intra- and/or extrahepatic bile ducts. The disease is one of the most common cholestatic diseases in adults and is diagnosed with increasing frequency. It is very often associated with ulcerative colitis. Patients with PSC have an increased incidence of bile duct carcinomas, and those with ulcerative colitis also have an increased incidence of colonic carcinomas. In end-stage disease, liver transplantation is the treatment of choice. Immunosuppressive treatment has little effect. Ursodeoxycholic acid (UDCA), which has been shown to improve liver histology and survival in patients with primary biliary cirrhosis, has a beneficial effect in PSC, provided that patients who develop major duct stenoses are treated endoscopically. The aim is to treat patients as early as possible to prevent progression to the advanced stages of the disease. During treatment with UDCA, stenoses of major ducts may develop, and early endoscopic dilation is highly effective. Because UDCA treatment improves but does not cure cholestatic liver diseases, permanent treatment seems to be necessary. Such prolonged treatment with UDCA may be recommended because, until now, no side effects have been reported. In patients with end-stage disease, UDCA is not effective and liver transplantation is indicated.