There is a fundamental lack of understanding about the changes in molecular pathology in alcoholic hepatitis at the liver biopsy tissue level. This isa result of technical difficulties which impede the examination of liver biopsy tissue beyond the morphologic changes observed. Recently techniques have been developed in the PI's laboratory, which now make it possible to examine the changes in gene expression in liver biopsies from patients with alcoholic hepatitis. The long term goal is to better understand the changes in gene expression at the molecular level and to correlate them with the cellular morphology level. The objective in this particular application is to determine, 1) the mechanism of cell cycle arrest in alcoholic hepatitis; 2) the pathophysiology of macrophages in the sinusoids in alcoholic hepatitis including their role in obstructing sinusoidal blood flow causing hypoxic injury to the hepatocytes; 3) the mechanism of balloon cell degeneration of hepatocytes in alcoholic hepatitis. These questions can now be answered directly on liver biopsy tissue due to the development of new technologies such as laser capture dissection and fluorescent intensity morphometric measurements of proteins located in the different cell population. The central hypothesis is that cell cycle arrest, epigenetic transformation of balloon hepatocytes and hypoxia of centrilobular hepatocytes caused by sinusoidal obstruction by macrophages, combine to injure hepatocytes, causing loss of function and liver failure in alcoholic hepatitis. The epigenetic changes that develop in ballooned hepatacytes lead to preneoplastic hepatocyte formation and development of hepatocellular carcinoma. This hypothesis has been formulated on the basis of preliminary data produced in the applicant's laboratory. The rationale for the proposed research is that understanding the fundamental mechanism of liver injury in alcoholic hepatitis will foster new and more effective treatments for alcoholic hepatitis in which cell cycle arrest is reversed to normal; obstructing macrophages are removed from the sinusoids and balloon cell degeneration is prevented. Guided by the strong preliminary data, this hypothesis will be tested by pursuing three specific aims. 1) Determine the mechanism of cell cycle arrest caused by p21 induction; 2) determine the 4 types of macrophages obstructing the sinusoids that cause centrilobular hypoxic injury, and 3) determine the epigenetic transformation that characterizes balloon cell degeneration of hepatocytes. The approach is innovative primarily because it utilizes new technologies described above, developed in the applicant's laboratory, enabling for the first time, the direct study of liver biopsies from patients with alcoholic hepatiis. The proposed research is significant because it is expected that when the mechanisms involved in alcoholic hepatitis are understood it will be possible to design therapies that are life saving with major cost savings that are currently expended in the treatment of alcoholic hepatitis.