There are multiple possible causes of ascites in patients with end-stage renal disease on hemodialysis therapy. In this report, we describe a patient with chronic hepatitis C infection who presented with refractory inflammatory ascites, along with cachexia, hypoalbuminemia, and erythropoietin resistance associated with the chronic inflammatory state induced by a failed kidney transplant. Evaluation showed only mild hepatic fibrosis, absence of portal hypertension, and no other identifiable cause of the ascites. Furthermore, the inflammatory ascites did not respond to antibiotic therapy, but promptly resolved, along with the other manifestations of the chronic inflammatory state, after transplant nephrectomy. This report describes a novel cause for refractory inflammatory ascites in a patient with a failed kidney transplant and emphasizes the importance of transplant nephrectomy.