The American College of Radiology Liver Imaging Reporting and Data System (LI-RADS) is the preeminent framework for classification and risk stratification of liver observations on imaging in patients at high risk for hepatocellular carcinoma. In this review, the pathogenesis of hepatocellular carcinoma and the use of MRI in LI-RADS is discussed, including specifically the LI-RADS diagnostic algorithm, its components, and its reproducibility with reference to the latest supporting evidence. The LI-RADS treatment response algorithms are reviewed, including the more recent radiation treatment response algorithm. The application of artificial intelligence, points of controversy, LI-RADS relative to other liver imaging systems, and possible future directions are explored. After reading this article, the reader will have an understanding of the foundation and application of LI-RADS as well as possible future directions.