Chronic hepatic allograft rejection is characterized by the histological findings of ductopenia and a decreased number of hepatic arteries in portal tracts in the presence of foam cell (obliterative) arteriopathy. Recent studies have extended the histological spectrum of chronic rejection to include the presence of biliary epithelial atrophy or pyknosis involving the majority of small ducts present in the liver biopsy specimen. Overall, the incidence of chronic rejection in adults appears to be decreasing and is currently approximately 4%. However, the incidence of chronic rejection in pediatric liver transplant recipients has been more stable and ranges from 8% to 12% in most studies. Clinical risk factors associated with chronic rejection include: underlying liver disease, HLA donor-recipient matching, positive lymphocytotoxic cross-match, cytomegalovirus infection, recipient age, donor-recipient ethnic origin, male donor into female recipient, number of acute rejection episodes, histological severity of acute rejection episodes, low cyclosporine trough levels, and retransplantation for chronic rejection. Chronic rejection, once diagnosed, frequently leads to graft failure; however, a number of reports indicated 20% to 30% of the patients with this diagnosis may respond to additional immunosuppressive therapy or even resolve spontaneously receiving baseline immunosuppression. Newer immunosuppressive agents, such as tacrolimus and mycophenolate, may successfully reverse chronic rejection, particularly when it is diagnosed in its early histological stages.