The root cause of Caroli disease and Caroli syndrome are poorly understood till now, but it is thought to be genetic conditions. It is not usually associated with any family history and can occur sporadically in an individual. However, there are some rare evidence available that states it is autosomal dominant inheritance in association with autosomal dominant polycystic kidney disease ^{_Genetic_and_Rare_Diseases_Information_Center_(GARD)_–_an_NCATS_Program-1|[1]}. Caroli syndrome is generally an autosomal recessive disorder and is often seen in association with autosomal recessive polycystic kidney disease^[2]

The simple form is an autosomal dominant trait while the complex form is an autosomal recessive trait.^[3]Family history may include kidney and liver disease due to the link between Caroli Disease and ARPKD. PKHD1, the gene linked to ARPKD, has been found mutated in patients with Caroli syndrome. PKHD1 is expressed primarily in the kidneys with lower levels in the liver, pancreas, and lungs, a pattern consistent with phenotype of the disease, which primarily affects the liver and kidneys.^[3] The genetic basis for the difference between Caroli disease and Caroli syndrome has not been defined.