It is estimated that more than 100 children die of influenza-associated encephalopathy (influenza encephalopathy) every year in Japan. Influenza encephalopathy is distinct from Reye's syndrome. Specifically, 20% of influenza encephalopathy patients exhibit bilateral thalamic necrosis on neuroimaging, a lesion referred to as acute necrotizing encephalopathy (ANE). Influenza encephalopathy may develop by the same pathogenetic mechanisms as ANE, possibly via vasoactive substances or a process leading to vasoconstriction in the central nervous system (CNS). A novel substitution at the receptor-binding site (Tyr 137 to Phe) was reported to be found exclusively in influenza type A (H3N2) viruses isolated from patients with influenza encephalopathy, suggesting that encephalopathy may be caused by a variant influenza type A (H3N2) virus. Recently, it has been reported that cytokines may mediate the disease and that a high plasma concentration of interleukin-6 could be an indicator of progression to encephalopathy. Although it is unknown whether influenza virus invades the CNS, amantadine therapy for influenza encephalopathy has been tried in Japan, in patients in whom influenza type A infection has been demonstrated by rapid antigen detection tests.