The theory that the liver is characterized by diffusing and mediating first appeared in Yellow Emperor's Inner Canon (黄帝内经). It is the description of the normal climate changes and natural scene in spring, and is also the high-level generalization of the liver's important physiological functions in Yellow Emperor's Inner Canon (黄帝内经). Based on the theories in Yellow Emperor's Inner Canon (黄帝内经), this paper elaborates the liver's characteristic in diffusing and mediating and its important role in human physiology and pathology system from the relationship between liver and defensive qi, between liver and qi, blood, emotions, or body fluid, as well as between the liver and other visceral manifestations.