Primary sclerosing cholangitis is a chronic cholestatic liver disease of unknown aetiology. The course of the disease is usually progressive with the development of liver cirrhosis leading to death or liver transplantation within an average of 12 years. To date it is well known that the development of hepatobiliary malignancies and the rate of colonic mucosal dysplasia and carcinoma in patients with concomitant ulcerative colitis are greatly enhanced in patients with PSC. PSC can therefore be regarded as a premalignant condition. The following review will focus on the development of cholangiocellular carcinoma in patients with PSC and the associated diagnostic and therapeutic challenges.