Nonalcoholic fatty liver disease (NAFLD) is a chronic liver disease that occurs in nondrinkers but which cannot be distinguished from alcohol-induced liver disease histologically. There are no diagnostic blood tests for NAFLD but the disease is associated with several insulin-resistant states, including obesity, type 2 diabetes mellitus and dyslipidemia. Most of the liver-related morbidity and mortality that accompany NAFLD occur in patients who develop cirrhosis. The latter is most likely to occur in individuals who have progressed from simple steatosis (fatty liver) to steatohepatitis, a chronic inflammatory liver lesion. The mechanisms that promote the transition from steatosis to nonalcoholic steatohepatitis appear to involve multiple cellular adaptations to the oxidative stress that occurs when fatty acid metabolism is deranged during insulin resistance. A better understanding of these mechanisms is desired to target treatments to prevent and/or reverse nonalcoholic steatohepatitis, thereby aborting the evolution of cirrhosis.