Background: Liver MRI is commonly used for detection and evaluation of focal liver lesions (FLL). Diffusion weighted imaging (DWI) is a functional MR imaging which qualitatively and quantitatively assess the diffusion property of lesion. DWI is a fast sequence that does not require contrast administration. So, it can be used safely as an alternative to contrast sequence in renal insufficiency patients. The study was done to evaluate the role of DWI in characterization of focal liver lesions and differentiation of benign and malignant lesions. Materials & Methods: 40 patients with 52 liver lesions were evaluated with diffusion weighted imaging at tertiary level hospital on 3T Philips Achieva MRI machine. Informed consents were obtained from patients. DWI of liver was done using three b values (0, 500, 1000 sec/mm2 ). Qualitative and quantitative assessment of FLL was done using DWI and ADC map. All relevant clinical history, laboratory reports (AFP level), findings on other imaging modalities (USG, CT scan) and biopsy/FNAC were considered for final diagnosis of focal liver lesions. Results: On qualitative analysis, all malignant lesions & abscesses showed restricted diffusion. Most of benign lesions disappeared on higher b values except one hemangioma & all abscesses. On quantitative analysis, mean ADC values for different lesions were obtained. There was significant difference (p<0.0001) between mean ADC value of malignant (1.02 x10-3 mm 2 /s) and benign (1.87x10-3 mm 2 /s) lesions. ADC cut off value of 1.42 x10-3 mm 2 /s for differentiating benign and malignant liver lesions was obtained with sensitivity of 96.3% and specificity of 72.0%. Conclusion: Qualitative and quantitative assessment of diffusion weighted images and ADC map in addition to conventional MRI could be used in characterization of focal hepatic lesions and in differentiation between benign and malignant focal liver lesions