Background & Aims: Alcohol disturbs hepatic lipid synthesis and transport, but the role of lipid dysfunction in alcohol-related liver disease (ALD) is unclear. In this biopsy-controlled, prospective, observational study, we characterized the liver and plasma lipidomes in patients with early ALD. Methods: We performed mass spectrometry–based lipidomics of paired liver and plasma samples from 315 patients with ALD and of plasma from 51 matched healthy controls. We associated lipid levels with histologic fibrosis, inflammation, and steatosis with correction for multiple testing and adjustment for confounders. We further investigated sphingolipid regulation by means of quantitative real-time polymerase chain reaction sequencing of microRNA, prediction of liver-related events, and tested causality with Mendelian randomization. Results: We detected 198 lipids in the liver and 236 lipids in the circulation from 18 lipid classes. Most sphingolipids (sphingomyelins and ceramides) and phosphocholines were co–down-regulated in both liver and plasma, where lower abundance correlated with higher fibrosis stage. Sphingomyelins showed the most pronounced negative correlation to fibrosis, mirrored by negative correlations in both liver and plasma with hepatic inflammation. Reduced sphingomyelins predicted future liver-related events. This seemed to be characteristic of “pure ALD,” as sphingomyelin levels were higher in patients with concomitant metabolic syndrome and ALD/nonalcoholic fatty liver disease overlap. Mendelian randomization in FinnGen and UK Biobanks indicated ALD as the cause of low sphingomyelins, and alcohol use disorder did not correlate with genetic susceptibility to low sphingomyelin levels. Conclusions: Alcohol-related liver fibrosis is characterized by selective and progressive lipid depletion in liver and blood, particularly sphingomyelins, which also associates with progression to liver-related events.