Alterations in bile secretion at the hepatocellular and cholangiocellular levels may cause cholestasis. Formation of 'toxic bile' may be the consequence of abnormal bile composition and can result in hepatocellular and/or bile duct injury. The canalicular phospholipid flippase (Mdr2/MDR3) normally mediates biliary excretion of phospholipids, which normally form mixed micelles with bile acids and cholesterol to protect the bile duct epithelium from the detergent properties of bile acids. Mdr2 knockout mice are not capable of excreting phospholipids into bile and spontaneously develop bile duct injury with macroscopic and microscopic features closely resembling human sclerosing cholangitis. MDR3 mutations have been linked to a broad spectrum of hepatobiliary disorders in humans ranging from progressive familial intrahepatic cholestasis in neonates to intrahepatic cholestasis of pregnancy, drug-induced cholestasis, intrahepatic cholelithiasis, sclerosing cholangitis and biliary cirrhosis in adults. Other examples for bile injury due to the formation of toxic bile include the cholangiopathy seen in cystic fibrosis, after lithocholate feeding (in mice) and vanishing bile duct syndromes induced by drugs and xenobiotics. Therapeutic strategies for cholangiopathies may target bile composition/toxicity and the affected bile duct epithelium itself, and ideally should also have anti-cholestatic, anti-fibrotic and anti-neoplastic properties. Ursodeoxycholic acid (UDCA) shows some of these properties, but is of limited efficacy in the treatment of human cholangiopathies. By contrast to UDCA, its side chain-shortened homologue norUDCA undergoes cholehepatic shunting leading to a bicarbonate-rich hypercholeresis. Moreover, norUDCA has anti-inflammatory, anti-fibrotic and anti-proliferative effects, and stimulates bile acid detoxification. Upcoming clinical trials will have to demonstrate whether norUDCA or other side chain-modified bile acids are also clinically effective in humans. Finally, drugs for the treatment of cholangiopathies may target bile toxicity via nuclear receptors (FXR, PPARalpha) regulating biliary phospholipid and bile acid excretion.