Background: Acute-on-chronic liver failure (ACLF), as the end-stage of chronic liver diseases, is characterized by very high short-term mortality. Objectives: In this work, pathomechanisms of ACLF development, diagnostic as well as prognostic criteria are discussed. Methods: Review of the literature related to ACLF, analyses and discussion of the results. Results: Severe systemic inflammation, as a response to precipitating events (infections, acute alcoholic hepatitis, bleeding), is the main pathomechanism for the development and progression of ACLF. Novel prognostic scoring tests using liver function markers and elastography can be useful for the identification of patients at risk to develop ACLF. ACLF is defined as single or multiorgan failure in patients with decompensated liver cirrhosis. Organ failures are classified using the modified chronic liver failure-sequential organ failure assessment (CLIF-SOFA) score (liver, coagulation, kidney, brain, lung, circulation). The CLIF-C-ACLF score is a combination of CLIF-SOFA, age and inflammatory markers at the time of ACLF diagnosis. Kidney and brain failure are relevant markers and determinants of poor patient outcome. CLIF-C-ACLF score is useful to identify patients with ACLF and predict individual 30-day short-term mortality. Conclusions: ACLF is a life-threatening disease. Prognostic scoring tests might be suitable to identify patients at risk. Early diagnosis of ACLF and identification of individual precipitating events is crucial for timely treatment decisions.