Product Liability Reform Act of 1986 - Preempts inconsistent State laws. Declares that the provisions of this Act are inapplicable in certain actions under the Atomic Energy Act of 1954.

Bases liability for damages in product liability actions on whether: (1) the design, production, distribution, or sale of the product was negligent; or (2) the product was defective, and such defect rendered the product unreasonably dangerous.

Includes among the applicable defenses in such actions proof that: (1) the defect was the subject of an adequate warning; (2) the defect was apparent to a reasonable person, or the subject of common knowledge; (3) the injury resulted from an unreasonable or unforeseeable use or alteration of the product; and (4) at the time the product was made, the ability to discover and eliminate the defect was unavailable.

States that joint and several liability may not be applied to any product liability action subject to this Act (unless persons acting in concert were the proximate cause of the injury).

Limits the amount of damages for noneconomic losses to $100,000. Requires that damage awards for future economic losses exceeding $100,000 be made by periodic payments. Requires that damage awards be offset by amounts received as compensation for the same injury.

Establishes a contingency fee schedule for plaintiffs' attorneys.

Directs the Attorney General to provide recommendations regarding the creation, adoption, and use of alternative dispute resolution techniques.