Hepatic injury presenting as jaundice, hypglycemia, encephalopathy, coagulation disturbances and a significant increase in transaminases in a late well recognized complication of sepsis. Less known is a cholestatic liver injury, which can precede sepsis. This type of early liver injury is characterized by a rise of direct bilirubin and less prominent increase in liver enzymes. Experimental work in animal models demonstrates that sepsis associated cholestasis is mediated by a variety of gram negative bacterial endotoxins and cytokines which interfere with the function of bile acid intracellular transporters. Although sepsis associated cholestasis is quite common, its clinical and prognostic characteristics are not widely appreciated. This often results in performance of unnecessary procedures and delayed diagnosis. Here we review the relevant updated literature regarding the pathophysiological basis of this phenomenon and its clinical presentation and implications.