The relationship between drugs and pre-existing liver disease is complex, particularly when increased liver tests (LTs) or new symptoms emerge in patients with pre-existing liver disease during drug therapy. This requires two strategies to assess whether these changes are due to drug-induced liver injury (DILI) as a new event or due to flares of the underlying liver disease. Lacking a valid diagnostic biomarker, DILI is a diagnosis of exclusion and requires causality assessment by RUCAM, the Roussel Uclaf Causality Assessment Method, to establish an individual causality grading of the suspected drug(s). Flares of pre-existing liver disease can reliably be assessed in some hepatotropic virus infections by polymerase chain reaction (PCR) and antibody titers at the beginning and in the clinical course to ascertain flares during the natural course of the disease. Unfortunately, flares cannot be verified in many other liver diseases such as alcoholic liver disease, since specific tests are unavailable. However, such a diagnostic approach using RUCAM applied to suspected DILI cases includes clinical and biological markers of pre-existing liver diseases and would determine whether drugs or underlying liver diseases caused the LT abnormalities or the new symptoms. More importantly, a clear diagnosis is essential to ensure effective disease management by drug cessation or specific treatment of the flare up due to the underlying disease.