Alcohol consumption is a leading cause of preventable morbidity and mortality worldwide and the primary cause of advanced liver disease. Alcohol use disorder (AUD) is a chronic, frequently relapsing condition characterized by persistent alcohol consumption despite its negative consequences. Alcohol-associated liver disease (ALD) encompasses a series of stages, from fatty liver (steatosis) to inflammation (steatohepatitis), fibrosis, and, ultimately, liver cirrhosis and its complications. The development of ALD is complex, involving both genetic and environmental factors, yet the exact mechanisms at play remain unclear. Alcohol-associated hepatitis (AH), a severe form of ALD, presents with sudden jaundice and liver failure. Currently, there are no approved targeted therapies able to interfere in the pathogenesis of ALD to stop the progression of the disease, making alcohol abstinence the most effective way to improve prognosis across all stages of ALD. For patients with advanced ALD who do not respond to medical therapy, liver transplantation is the only option that can improve prognosis. Recently, AH has become an early indication for liver transplantation in non-responders to medical treatment, showing promising results in carefully selected patients. This review provides an update on the epidemiology, natural history, pathogenesis, and current treatments for ALD. A deeper insight into novel targeted therapies investigated for AH focusing on new pathophysiologically-based agents is also discussed, including anti-inflammatory and antioxidative stress drugs, gut-liver axis modulators, and hepatocyte regenerative molecules.