Hepatobiliary disorders associated with orally administered terbinafine have rarely been reported. We describe a case of prolonged terbinafine-induced cholestatic liver disease. Extrahepatic cholestasis, viral hepatitis and autoimmune liver disorders were excluded. The histological findings of marked cholestasis without evidence of extrahepatic biliary obstruction or acute hepatitis were compatible with the diagnosis of drug-induced liver disease. Biochemical parameters of liver cell damage returned to normal levels 6 months later.