The cholinergic system is involved in specific behavioural responses and cognitive processes. Here, we examined potential alterations in the brain levels of key cholinergic enzymes in cirrhotic patients and animal models with liver failure. An increase (∼30%) in the activity of the acetylcholine-hydrolyzing enzyme, acetylcholinesterase (AChE) is observed in the brain cortex from patients deceased from hepatic coma, while the activity of the acetylcholine-synthesizing enzyme, choline acetyltransferase, remains unaffected. In agreement with the human data, AChE activity in brain cortical extracts of bile duct ligated (BDL) rats was increased (∼20%) compared to controls. A hyperammonemic diet did not result in any further increase of AChE levels in the BDL model, and no change was observed in hyperammonemic diet rats without liver disease. Portacaval shunted rats which display increased levels of cerebral ammonia did not show any brain cholinergic abnormalities, confirming that high ammonia levels do not play a role in brain AChE changes. A selective increase of tetrameric AChE, the major AChE species involved in hydrolysis of acetylcholine in the brain, was detected in both cirrhotic humans and BDL rats. Histological examination of BDL and non-ligated rat brains shows that the subcellular localization of both AChE and choline acetyltransferase, and thus the accessibility to their substrates, appears unaltered by the pathological condition. The BDL-induced increase in AChE activity was not parallelled by an increase in mRNA levels. Increased AChE in BDL cirrhotic rats leads to a pronounced decrease (∼50–60%) in the levels of acetylcholine. Finally, we demonstrate that the AChE inhibitor rivastigmine is able to improve memory deficits in BDL rats. One week treatment with rivastigmine (0.6 mg/kg; once a day, orally, for a week) resulted in a 25% of inhibition in the enzymatic activity of AChE with no change in protein composition, as assessed by sucrose density gradient fractionation and western blotting analysis. In conclusion, this study is the first direct evidence of a cholinergic imbalance in the brain as a consequence of liver failure and points to the possible role of the cholinergic system in the pathogenesis of hepatic encephalopathy.