Bile acids (BA) are actively reabsorbed in the terminal ileum by the apical Na⁺-dependent bile salt transporter. This review addresses the epidemiology, pathophysiology, diagnosis and treatment of BA diarrhea (BAD). BAD is typically caused by ileal resection or disease; 25–33% of patients with chronic functional diarrhea or irritable bowel syndrome-diarrhea (IBS-D) have BAD, possibly from deficiency in the ileal hormone, FGF-19, which normally provides feedback inhibition of BA synthesis. Diagnosis of BAD is typically based on reduced BA retention of radiolabeled BA (⁷⁵SeHCAT), increased BA synthesis (serum C4) or increased fecal BA loss. In clinical practice, diagnosis is often based on response to BA sequestrants (e.g., cholestyramine or colesevelam). Diagnostic tests for BA malabsorption (BAM) need to be used more extensively in clinical practice. In the future, farnesoid X receptor agonists that stimulate ileal production of FGF-19 may be alternative treatments of BAD.