Like several other ATP-binding cassette (ABC) transporters, ABCB4 is a lipid translocator. It translocates phosphatidylcholine (PC) from the inner to the outer leaflet of the canalicular membrane of the hepatocyte. Its function is quite crucial as evidenced by a severe liver disease, progressive familial intrahepatic cholestasis type 3, which develops in persons with ABCB4 deficiency. Translocation of PC makes the phospholipid available for extraction into the canalicular lumen by bile salts. The primary function of biliary phospholipid excretion is to protect the membranes of cells facing the biliary tree against these bile salts: the uptake of PC in bile salt micelles reduces the detergent activity of these micelles. In this review, we will discuss the functional aspects of ABCB4 and the regulation of its expression. Furthermore, we will describe the clinical and biochemical consequences of complete and partial deficiency of ABCB4 function.