The Collaborative International Dictionary of English v.0.48:

Liability \Li`a*bil"i*ty\ (l[imac]`[.a]*b[i^]l"[i^]*t[y^]), n.;
   pl. Liabilities (-t[i^]z).
   [1913 Webster]
   1. The state of being liable; as, the liability of an
      insurer; liability to accidents; liability to the law.
      [1913 Webster]

   2. That which one is under obligation to pay, or for which
      one is liable. Specifically, in the pl., the sum of one's
      pecuniary obligations; -- opposed to assets.
      [1913 Webster]

   Limited liability. See Limited company, under Limited.
      [1913 Webster]

WordNet (r) 3.0 (2006):

liability
    n 1: the state of being legally obliged and responsible
    2: an obligation to pay money to another party [syn:
       indebtedness, liability, financial obligation]
    3: the quality of being something that holds you back [ant:
       asset, plus]