Hepatic encephalopathy (HE) is a serious neuropsychiatric and neuro-cognitive complication of acute and chronic liver disease. Symptoms are often overt (confusion, disorientation, ataxia, or coma) but can also be subtle (difficulty with cognitive abilities such as executive decision making and psychomotor speed). There is consensus that HE is characterized as a spectrum of neuropsychiatric symptoms in the absence of brain disease, ranging from overt hepatic encephalopathy (OHE) to minimal hepatic encephalopathy (MHE). The West Haven Criteria are most often used to grade HE, with scores ranging from 0 to 4 (4 being coma). However, it is a challenge to diagnose patients with MHE or grade 1 HE-it might be practical to combine these entities and name them covert HE, for clinical use. The severity of HE is associated with the stage of liver disease. Although the pathologic mechanisms of HE are not well understood, they are believed to involve increased levels of ammonia and inflammation, which lead to low-grade cerebral edema. A diagnosis of MHE requires dedicated psychometric tests and neuro-physiological techniques, rather than a simple clinical assessment. Although these tests can be difficult to perform in practice, they are cost-effective and important; the disorder affects patients' quality of life, socio-economic status, and driving ability and increases their risk for falls and the development of OHE. Patients with MHE are first managed by excluding other causes of neuro-cognitive dysfunction. Therapy with gut-specific agents might be effective. We review management strategies and important areas of research for MHE and covert HE.