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Alcohol use disorder (AUD) or alcoholism is a chronic relapsing disorder. Our knowledge of alcoholism hinges on our understanding of its effects on the brain. This review will center on the effects of alcohol in the lateral habenula (LHb), an epithalamic structure that connects the forebrain with the midbrain and encodes aversive signaling.Like many addictive drugs, alcohol has both rewarding and aversive properties. While alcohol's euphoric property is believed to be important for the initiation of drinking, increasing evidence suggests that alcohol's negative affect plays a critical role in excessive drinking and alcohol dependence. During withdrawal and abstinence, alcoholics often experience anxiety and depressions, both of which have been implicated in relapse drinking.This review focuses on the recent accumulation of knowledge about the effects of acute and chronic alcohol exposure on the activity of and synaptic transmissions on LHb neurons, as well as the effects of manipulation of LHb function on alcohol consumption and related behaviors. Recent evidence highlights a critical role for the LHb in AUD and related psychiatric ailments. Multidisciplinary work in animals collectively suggests that LHb function and activity, including M-type potassium channels and glutamatergic transmission are altered by acute and repeated chronic alcohol exposure. We will also discuss how functional, pharmacological, and chemogenetic manipulation of the LHb affects ethanol drinking and psychiatric disorders occurring in animals withdrawn from chronic alcohol exposure. Conceivable mechanisms behind these effects and their potential as targets for therapies will also be discussed.Recent evidence highlights a critical role for the LHb in alcohol abuse and related psychiatric ailments.M-type K+ channels and glutamate receptors which tightly control LHb function and activity are altered by alcohol exposure.Manipulation of LHb activity affects ethanol drinking and psychiatric disorders in an animal model.Conceivable mechanism behind these effects and their potential as targets for therapies will also be discussed.