The presence of dilutional hyponatremia has a poor prognosis for survival in patients with cirrhosis and ascites. Effective and safe treatments are needed to improve prognosis in patients with cirrhosis and dilutional hyponatremia. The initial approach to management includes fluid restriction, low sodium diet, and minimizing the use of diuretics. In addition, the use of hypertonic saline should be avoided in patients with cirrhosis and dilutional hyponatremia. Furthermore, patients should be placed on the top of the list for liver transplantation if they are appropriate candidates. Although V2 arginine vasopressin receptor antagonists that selectively enhance solute-free water excretion in patients with cirrhosis seem very promising, two points must be considered in relation to the available data. First, although the results of phase-2 studies are encouraging, the efficacy and safety of these compounds should be further evaluated. Second, the clinical utility of these agents in cirrhosis has only been assessed in short-term studies. The long-term effects of these drugs remain unknown. Future research with these compounds should not only focus on the effects on serum sodium, but also on treatment and prevention of recurrence of ascites. In addition, the possible beneficial effects of these drugs in the prevention of hepatic encephalopathy would be worth studying.