The most common complication to chronic liver failure is ascites. The formation of ascites in the cirrhotic patient is caused by a complex chain of pathophysiological events involving portal hypertension and progressive vascular dysfunction. Since ascites formation represents a hallmark in the natural history of chronic liver failure it predicts a poor outcome with a 50% mortality rate within 3 years. Patients with ascites are at high risk of developing complications such as spontaneous bacterial peritonitis, hyponatremia and progressive renal impairment. Adequate management of cirrhotic ascites and its complications betters quality of life and increases survival. This paper summarizes the pathophysiology behind cirrhotic ascites and the diagnostic approaches, as well as outlining the current treatment options. Despite improved medical treatment of ascites, liver transplantation remains the ultimate treatment and early referral of the patient to a highly specialized hepatology unit should always be considered.