Drug-induced liver injury (DILI) has become a leading cause of severe liver disease in Western countries and therefore poses a major clinical and regulatory challenge. Whereas previously drug-specific pathways leading to initial injury of liver cells were the main focus of mechanistic research and classifications, current concepts see these as initial upstream events and appreciate that subsequent common downstream pathways and their attenuation by drugs and other environmental and genetic factors also have a profound impact on the risk of an individual patient to develop overt liver disease. This review summarizes current mechanistic concepts of DILI in a 3-step model that limits its principle mechanisms to three main ways of initial injury, i.e. direct cell stress, direct mitochondrial impairment, and specific immune reactions. Subsequently, initial injury initiates further downstream events, i.e. direct and death receptor-mediated pathways leading to mitochondrial permeability transition, which then results in apoptotic or necrotic cell death. For all mechanisms, mitochondria play a central role in events leading to apoptotic vs. necrotic cell death. New treatment targets consequently focus on interference with downstream pathways that mediate injury and therefore determine the ultimate outcome of DILI. Genome wide and targeted pharmacogenetic as well as metabonomic approaches are now used in order to reach the key goals of a better understanding of mechanisms in hepatotoxicity, and to develop new strategies for its prediction and treatment. However, the complexity of interactions between genetic and environmental risk factors is considerable, and DILI therefore currently remains unpredictable for most hepatotoxins.