The natural history of cirrhotic patients is highly variable due to several factors including hepatic synthetic function, presence and degree of portal hypertension, the cause of cirrhosis, the possibility of resolution of the underlying damaging process, and the occurrence of liver cancer. Currently, D'Amico stage classification and Child-Pugh and Model for End-Stage Liver Disease (MELD) scores constitute the best tools to predict mortality in patients with cirrhosis; however, one of their main limitations is the lack of evaluation of the nutritional and functional status. Most widely recognized complications in cirrhotic patients include ascites, hepatic encephalopathy, variceal bleeding, kidney dysfunction, and hepatocellular carcinoma; however, sarcopenia or severe muscle wasting is one of the most common and frequently hidden complications which negatively impact survival, quality of life, and response to stressor, such as infection and surgery. In this review, we discuss the current accepted and new methods to evaluate prognosis in cirrhosis, and also analyze the current knowledge regarding incidence and clinical impact of malnutrition and sarcopenia in cirrhosis and their impact after liver transplantation. We also discuss existing and potential novel therapeutic strategies for malnutrition in cirrhosis, emphasizing the recognition of sarcopenia in cirrhosis in an effort to improve survival and reduced morbidity related to cirrhosis. Finally, we propose that future studies including sarcopenia with the MELD score may allow better prediction of mortality among cirrhotic patients waiting for liver transplantation; however, due to the worldwide shortage of organs for transplants, one of the vital clinical questions is the feasibility to treat sarcopenia in cirrhosis without the need of liver transplant.