Hepatic encephalopathy and elevated serum ammonia levels occur commonly after portacaval shunt and are hypothesized to be, in part, due to decreased hepatic blood flow. Prior work has demonstrated increased blood flow to the liver following hepatic periarterial neurectomy. In this experimental study, we investigated the functional, hemodynamic, and histopathological changes in the liver and kidney occurring after the addition of hepatic periarterial neurectomy to side-to-side portacaval shunt in dogs. It is our hypothesis that the addition of hepatic periarterial neurectomy to portacaval shunt will decrease postshunt ammonia levels. Side-to-side portacaval shunt was performed in 12 dogs (group I). Hepatic periarterial neurectomy was added to portacaval shunt in 9 dogs (group II). Serum levels of ammonia, urea, creatinine, alanine aminotransferase, aspartate aminotransferase, alkaline phosphatase, albumin, and bilirubin together with hepatic blood flow were determined in both groups preoperatively and on postoperative day 21. The pre- and postoperative histopathologic changes of the liver and kidney were evaluated. There was significantly less postoperative elevation of serum ammonia and aspartate aminotransferase when hepatic periarterial neurectomy was added to the portacaval shunt procedure. Hemodynamic studies of hepatic artery and hepatic tissue indicated better blood flow in group II. The histopathologic evaluation of group II showed expansion of sinusoids, portal vessels, and portal areas and increased portal fibrosis as compared to group I. The results of this experimental study show that adding hepatic periarterial neurectomy to the portacaval shunt procedure improves postoperative serum levels of ammonia and aspartate aminotransferase and hepatic artery and tissue blood flow.