Intestinal failure (IF)-associated liver disease (IFALD) is a spectrum of liver dysfunction arising from prolonged parenteral nutrition (PN) dependence in individuals with chronic intestinal failure (IF). IFALD encompasses cholestasis, steatosis, fibrosis, and cirrhosis, with higher prevalence in pediatric patients. The etiology is multifactorial, involving nutrient toxicity and deficiency, intestinal dysfunction, systemic infections, and genetic factors. Excessive energy intake, glucose overload and soybean-based lipid emulsions contribute to hepatotoxicity, while deficiencies in choline, carnitine, and essential fatty acids impair hepatic metabolism. Predictive biomarkers, including plasma citrulline, FGF19, and the MESIF score, are essential for early detection, alongside imaging tools like FibroScan and magnetic resonance imaging (MRI). Prevention focuses on optimizing PN composition, increasing enteral nutrition, and using fish oil-based lipid emulsions. Medical treatments include ursodeoxycholic acid and antioxidants, while surgical options like autologous gastrointestinal reconstructive procedures and intestinal transplantation are considered for severe cases. Isolated liver transplantation is indicated for patients with liver failure and portal hypertension, while combined liver–intestine transplantation is reserved for irreversible IF. Advances in transplantation techniques have significantly improved survival and quality of life, reducing PN dependence and enhancing long-term outcomes for both pediatric and adult populations.